Information Security: Lessons from Behavioural Economics

Psychological and sociological factors constrain economic decision-making in many contexts including the online world. In particular, uncertainty limits the optimising behaviour which is often the focus of economic models and so people will be forced to rely on simpler decision-making rules when managing information online. Behavioural economics and economic psychology emphasise that people will make many mistakes in processing information and planning for the future and these mistakes will also distort learning processes. Emotions and visceral factors will play a key role not only affecting people’s actions and choices but also the connection between information, learning and choices. All these forces will have wide-ranging implications for information security management and this paper summarises some of the key insights and policy lessons for infor-