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Cyberrisk and AI Firms

Author

Listed:
  • Kumar Rishabh

    (University of Basel)

  • Roxana Mihet

    (Swiss Finance Institute - HEC Lausanne)

  • Julian Jang-Jaccard

    (Swiss Federal Office for Defence Procurement)

Abstract

Does AI make firms vulnerable or resilient to cyber risk? To answer this, we develop a novel measure identifying AI-intensive U.S. public firms using publicly available patents and business-description data. While cyber threats typically suppress innovation, AI-intensive firms neutralize this effect. This protective effect strengthens with greater AI experience. Moreover, firms combining AI innovation and implementation exhibit a stronger buffer protecting their innovation and financial outcomes under cyber stress, whereas firms merely implementing AI without internal innovation gain no such resilience. Our results emphasize internal AI innovation as fundamental in enabling firms to effectively withstand cyber threats.

Suggested Citation

  • Kumar Rishabh & Roxana Mihet & Julian Jang-Jaccard, 2025. "Cyberrisk and AI Firms," Swiss Finance Institute Research Paper Series 25-39, Swiss Finance Institute.
    • Handle: RePEc:chf:rpseri:rp2539
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    File URL: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5202362
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    More about this item

    Keywords

    Cyberrisk; artificial intelligence; innovation; resilience; economics of AI; economics of cybercrime;
    All these keywords.

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • G3 - Financial Economics - - Corporate Finance and Governance
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

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