CyberEconomics/CyberIntangibles blog – article 2:
The effects of cyberattacks on listed firms
This blog post summarizes the main findings of the work we conducted on the evaluation of the impact of cyberattacks on financial markets.
The effects of an economic event on firms’ value is a recurring theme in economics and management sciences. Finance theory suggests referring to financial market data in order to measure the impact of a specific event on the value of a firm through event study methodology. This methodology attempts to measure informative relevance of an event and to analyze stock prices reaction following the release of new information. According to this perspective, with a conjunction to the theory of signals, favorable (unfavorable) information generates an increase (decrease) in prices and therefore positive (negative) abnormal returns. Since the work of Dolley (1933) in which he investigated the effect of stock splits on stock prices, event study methodology had been adopted in different fields such as accounting and finance, management, marketing and information systems.