How Would Information Disclosure Influence Organizations' Outbound Spam Volume? Evidence from a Field Experiment

Cyber-insecurity is a serious threat in the digital world. In the present paper, we argue that a suboptimal cybersecurity environment is partly due to organizations’ underinvestment and a lack of suitable policies. The motivation for this paper stems from a related policy question: how to design policies for governments and other organizations that can ensure a sufficient level of cybersecurity. We address the question by exploring a policy devised to alleviate information asymmetry and to achieve transparency in cybersecurity information sharing practice. We introduce a cybersecurity evaluation agency along with regulations on information disclosure. To empirically evaluate the effectiveness of such an institution, we conduct a large-scale randomized field experiment on 7,919 U.S. organizations. Specifically, we generate organizations’ security reports based on their outbound spam relative to the industry peers, then share the reports with the subjects in either private or public ways. Using models for heterogeneous treatment effects and machine learning techniques, we find evidence that the security information sharing combined with publicity treatment has significant effects on spam reduction for original large spammers. Moreover, significant peer effects are observed among industry peers after the experiment