Network Economics of Cybercrime and Cybersecurity

Lately I have been quite fascinated by the modeling challenges of both cybercrime and cybersecurity with my belief that the latter can only be well understood and captured if one has a good handle on the former.

I have for quite a few years been researching network vulnerabilities and Patrick Qiang and I even wrote a book on that topic: Fragile Networks: Identifying Vulnerabilities and Synergies in an Uncertain World. So moving into cyberspace vulnerabilities was a natural. In addition, when the opportunity presented itself for funding in this area through the Advanced Cyber Security Center then clearly the timing was also right. In a collaboration between the Isenberg School of Management and the College of Engineering at UMass Amherst, we received 2 grants. As part of the second grant, our team organized a terrific workshop at the Sloan School at MIT  (I may be biased but it really was terrific from both idea generation and networking perspectives).. The workshop was on  cybersecurity risk analysis for enterprises.   One of the benefits of such a workshop is not only the brainstorming that takes place but also that research ideas that gel.

The first paper in this area in a stream of papers that I have authored or co-authored was recently published in the INFORMS journal Service Science and it is entitled: A Multiproduct Network Economic Model of Cybercrime in Financial Services, Service Science 7(1): (2015) pp 70-81.

INFORMS was kind enough to issue a press release on it: A New Model of Cybercrime Factors in Perishanility of Stolen Data, thanks to our wonderful Communications Director, Barry List.  The model focuses on financial service firms and captures the decay in the value of cyberhacked products over time in terms of their prices.

The network economic framework that I constructed in the paper permits quantifiable evaluation of various policy interventions that are investigated:

1. Determining the impact of strategies that make it harder to attack financial products’ source locations (computer servers)
2. Evaluating ways that make it harder for cybercriminals to make transactions through the common technique of increasing transaction costs
3. Exploring changes in the demand price to evaluate greater or lesser interest in criminal products at demand markets. 

The release has appeared on EurekAlert!, physorg.com, and also by UMass Amherst. I very much like the writeup by Paul Roberts on this paper that appeared in the Digital Guardian: Sale By Date: Research Finds that Stolen Data is Perishable.

As for our research on cybersecurity, there we also focus on the network issues and on the probability of an organization getting hacked and incurring associated damages, based on its investments in cybersecurity and also those of the others in their "network." We have developed a series of more general models with the latest one dealing with nonlinear budge constraints. In our work we care not only about good models but also effective computational procedures as well as insights for policy makers. We are utilizing game theory and variational inequality theory for the model formulations, qualitative analyses, and algorithmic implementations.

From Presidencies of Liberal Arts Colleges to Leading Iconic NYC Cultural Institutions - Those School Ties

I was absolutely delighted to hear the announcement yesterday in The New York Times that the former President of Lafayette College (my husband's undergraduate alma mater), Dr. Dan Weiss, who is an art historian, with an MBA from Yale, was selected to be the next President of the Metropolitan Museum of Art in NYC.

Dr. Weiss had served as Lafayette's President from 2005 - 2013 and I had the pleasure of meeting him and his wife at the college at a lovely event hosted by them in the Fall of 2012 at Lafayette. It was a pleasure to chat with them. They were so personable and pleasant and the conversations just flowed. The new college arts theater will be named after him and his wife, Sandra.

Weiss has been the President of Haverford College, another liberal arts college in Pennsylvania, since 2013,  and will be leaving after less than 2 years to become President of the Met, probably the top job for an art historian on our planet, so congratulations are in order!

In addition, the NYC Public Library is headed by Dr. Tony Marx, the former President of Amherst College, located  in the town that I live in. I last saw Dr. Marx when he gave the commencement speech at the Deerfield Academy graduation on May 27, 2012. Both his son and my daughter graduated Deerfield that day and the ceremonies were truly special and elegant.  Dr. Marx was part of the carpool on our block - impressive. And he did the driving when he was President of Amherst College, one of the top liberal arts colleges in the country!

Both the Metropolitan Museum of Art and the NYC Public Library, two iconic NYC institutions, are located on 5th Avenue about 40 blocks apart.

As Weiss said in The New York Times interview, he began going to the Metropolitan Museum of Art when he was a teenager and fell in love with it and so did I. The same holds for the NYC Public Library where I spent many a winter break from Brown University doing research and writing papers, as an undergraduate.

And, speaking of Lafayette, it has been quite the year for not only arts but also sports with the 150th anniversary football game played against Lehigh University at Yankee Stadium (Lafayette won) plus Lafayette's win last night in men's basketball against American University so now they are off to the big dance of the NCAA and garnered the Patriot League Championship. Congratulations!

The Academic Life and a Sense of Wonder

Spring is in the air and the snow is really melting today. Plus, it's great to have extra daylight.

Academic life is never boring and sometimes you experience a sense of wonder.

In the past 2 weeks I have had some rather amazing "coincidences" that I would like to share with my readers. These have added to some of the magic in what has been a record-breaking  cold and snowy winter.

About 10 days ago, while teaching my Humanitarian Logistics and Healthcare class,  I had the students read a paper by two female co-authors, one of whom I had met.

The next morning, I received an invitation from a foreign country to review this junior co-author's promotion and tenure case. Needless to say, I accepted and it will be an easy letter to write.

Last Monday, while teaching my Management Science Seminar, in which we have been discussing many different network models and behavioral principles,  I was describing spatial price equilibrium models, and talking about two of the notable contributors to this area, Professors Takayama and Judge. I even brought photos to share with students of Professor Takayama since I had met him at an amazing workshop in Mallacootta, Australia, just after my first book, Network Economics: A Variational Inequality Approach, was published (and I had carried a copy for him).

The very next day, there was a message in my email from none other than Professor George Judge of UC Berkeley. Part of the message said: Anna, nice surprise  when your name popped up on my computer this morning. So nice to know your are now working on dynamic network problems. 
Professor Judge celebrated his 80th birthday on May 2, 10 years ago and, hence, will be turning 90 this coming May. I had received a handwritten letter from him many years ago which is hanging in my office for inspiration since I respect him and his work so much. His latest book, written when he was about 85 was published by Cambridge University Press - truly inspiring! Of course I told him that just the day before I was not only thinking of him but talking about his earlier work!

Also, last Friday, we had the pleasure of hosting Dr. Radhika Kulkarni of SAS, whose brilliant talk I blogged about. I had told her about one of my former students, Emily Covill, who was an Operations and Information Management major at the Isenberg School and is getting her Master's at NCState in Analytics.  Radhika serves on the board of the Institute for Analytics there. Lo and behold, today, in my email, I had a message from Emily, saying "Employed!!!!." She received an offer from a top consulting firm in Boston and will begin there on September 1. I had not heard from Emily in several months until today. I was thrilled.

Succeeding with Business Analytics - Great Talk by Dr. Kulkarni of SAS

Today we had the great honor and pleasure of hosting Dr. Radhika Kilkarni, the VP of R&D Analytics at SAS in Cary, NC.

Kudos to the award-winning UMass Amherst INFORMS Student Chapter for organizing her visit. The students and chapter officers did a great job and I thank them! Special thanks to the Chapter President, Michael Prokle, for all the planning and attention to detail and logistics!

Dr. Kulkarni is both an INFORMS Fellow and a WORMS (Women in Operations Research and the Management Sciences) Award recipient and one of the highest technical females in her company, which has 11,000 employees and is consistently ranked as one of the top companies to work for in the US.

She began her day in the Isenberg School of Management with a meeting with students in the Elkins Boardroom. The school's  atrium was decorated with flags, which was perfect.

The conversations and questions and answers were so interesting that the session began at 8:30AM and lasted until almost the reception prior to her talk, at 10:30AM.

The free exchange of ideas, ranging from courses that should be offered in analytics curricula, to the training of doctoral students in the hot field of business analytics, to the kinds of projects that Dr. Kulkarni has been involved in from models of churning to ATM cash flow optimization for different banks in different countries, to hotel revenue management and price optimization, were so interesting! She spoke of the integration of different tools and the benefits of harnessing social networks data even in the modeling of fraud. Some of the themes she then further discussed in her presentation: Succeeding with Business Analytics: Key Challenges, that began at 11AM and that was streamed live to our online and part-time MBA students.

In her presentation she spoke of the challenges such as Big Data and the Internet of Things. She spoke of the need for speed in terms of algorithms, for example, which is also calling for high performance computer architectures and greater storage. With sensors interacting, there is a need for time series as well as statistical multivariate methods.

She emphasized the "mixing and matching" of different techniques, an idea that I very much appreciate.

Do you have the right date, the right process, and the right people, she asked?!

I also enjoyed hearing her say how important it is to exploit network data and information, including that gained from social media.

In the education of analytical experts, cross-disciplinarity is needed and the ability to collaborate.

Of course she emphasized the importance of knowledge of statistics, optimization and operations research, as well as mathematical modeling.

She ended on a highly enthusiastic note saying how lucky students are who are in this era of analytics.

There were great questions and I was delighted to also see some students from my Humanitarian Logistics and Healthcare class in the audience and even one of our OIM alums, Jonathan Farland, who came in from Boston to hear Dr. Kulkarni speak - a disclosure - he works in energy forecasting and uses SAS software.

At our lunch at the University Club we had such a great time (although the service was painfully slow and we finally got our lunch around 1:30PM) because the conversations were so much fun. We laughed so much with the stories that we exchanged.

Afterwards we had a roundtable in my Supernetworks Lab but there was some anxiety since Dr. Kulkarni's flight out of Bradley was delayed and it looked as though she would miss her second legged flight from Philly to Raleigh later this evening. We bid her farewell, all feeling so energized and intellectually stimulated.

Dr. Kulkarni's visit was co-sponsored by the INFORMS Speaker Program and  the Operations and Information Management Department, with additional support from my Chaired Professorship Fund, and with help from the MBA Programs Office.

Thanks to all involved and with special thanks to Dr. Radhika Kulkarni, an amazing role model and business analytics professional and operations researcher.

The Speaker Has Landed!

I have helped students in the UMass Amherst INFORMS Student Chapter to organize the UMass Amherst INFORMS Speaker Series for many semesters.

Of course, associated with bringing speakers from out of towm is the uncertainty as to whether they will be able to make it - things happen - illnesses and weather disruptions, to name just two. And, in fact, a program officer from NSF had to cancel her talk since her flight was cancelled from DC today.

Not only are the INFORMS offices closed in Maryland, but also USA Today is reporting that 20% of the flights in the US are cancelled today due to inclement weather.

Our speaker, Dr. Radhika Kulkarni, just landed a few minutes ago in Bradley Airport, having flown from Raleigh, NC through Pittsburgh to make it to her presentation at the Isenberg School tomorrow, with extra events planned. Needless to say all those involved have breathed a big sigh of relief, including me!

Special thanks to the INFORMS Speakers Program, the Department of Operations and Information Management at the Isenberg School, and the MBA Programs office for assisting in the co-sponsorship and organization of  this event. Her presentation at 11AM tomorrow will be viedotaped and streamed live to our interested MBA students.

The students did a great job  designing the poster below and Dr. Kulkarni's talk is advertised both on the UMass Amherst events page and the Isenberg webpage.

At 8:30AM tomorrow morning, we will be having a Meet and Greet in the Elkins Boardroom Room 111 in the Isenberg School.

Also, and just in time, the Officers of the Student Chapter have updated the student chapter poster on their Isenberg School bulletin board. Many thanks to the Chapter President, Michael Prokle, and the officers.

Who would have thought that the role of a professor is also being an events manager?

3 Papers Published in Less than 3 Weeks!

This has certainly been a winter of record-breaking cold as well as snowfalls in the Northeast of the US! In the case of Amherst, we had the coldest average temperatures in February since records were first taken back in 1835!

You may take some solace through the frigid temperatures and disruptions, the roof problems, ice dams, home water leaks, etc., from a recent study from Harvard University, "Rainmakers: Why bad weather means good productivity."

New Englanders tend to be very hardworking and, given the number of academic institutions in our area, we certainly contribute to the education and research missions.

I always say that "good news happens in 3s" and in less than 3 weeks I have had 3 papers published in journals, which I think is a record for me.

In academia, one may have a paper accepted for publication and then the journal will put it online but it may still take some time to have the paper actually appear in a journal volume. In academia we certainly learn patience and I try to instill that in my doctoral students, sometimes with mixed success.

On February 16, 2015, my paper, Design of Sustainable Supply Chains for Sustainable Cities, which was an invited paper for the Complex-City Workshop, December 5-6, 2011, Amsterdam, The Netherlands, was published in Environment & Planning B 42(1): (2015) pp 40-57. It had actually been posted online in January 2013, and then it took over 2 years to appear in a special edited volume of the journal.

The timing is, nevertheless, propitious, since, in mid-March, I will be delivering a big lecture at a plenary symposium in Berlin, Germany on the topic.

On February, 18, 2015, I had the pleasure of sharing the joy of a publication with one of my doctoral students, Dong "Michelle" Li. Our paper, A Supply Chain Network Game Theory Model with Product Differentiation, Outsourcing of Production and Distribution, and Quality and Price Competition, was published in the Annals of Operations Research 228(1), (2015) pp 479-503.

And today, March 4, 2015, the paper,  A Multiproduct Network Economic Model of Cybercrime in Financial Services, was published in Service Science 7(1): (2015) pp 70-81.

Amazingly, even the temperature now is above freezing in Amherst and some of the snow is starting to melt.

Marathon Mondays

This semester I have a Monday Wednesday teaching schedule but my Mondays are true marathons with a morning class on Humanitarian Logistics and Healthcare, which is an hour and a quarter, and an afternoon seminar, on Advances in Variational Inequalities, Networks, and Game Theory, which is 2 hours and 45 minutes. I do a lot of lecturing in the latter class, although it is a seminar, because I want to make sure to bring all the students who come from different programs on campus to more or less the same level of knowledge.

So, do the math, the sum is 4 hours, which is exactly how long it takes me to run a marathon, which I have done several times in the past (no matter what my training was). I never, ever sit while lecturing.

I love the energy expended on teaching and the energy that I get from my students. Plus, when you have the opportunity to teach subjects that you are passionate about, the time flies (and, yes, many times we go over the time but there is so much to discuss and share).

I love face to face teaching and the interactions with students, which I would really miss if all the classes were online plus teaching is fabulous exercise if you do it right!

And being a professor is also good for your health.

In a study, "Postponed aging in university teachers," Kristjuhan and Taidre write that: In some population groups, human life expectancy is much higher compared to the average in the population, which can provide new hints to postpone aging and prolong life. Studies show that university professors have a later onset of age-related diseases compared with most population groups. Their productivity mostly increases up to their 60s and remains high for many years afterward. Aging processes appear later compared to the average in the population. Studies in Estonia have shown that university professors have 9 years longer life.

Operations research and economics have a good number of faculty that I have had the privilege of meeting and some even knowing that worked through their 80s and even part of their 90s (Professors George Dantzig, Kenneth Arrow, Leonid Hurwicz, Bill Cooper, Paul Samuelson, and Martin Beckmann, to start).   And unlike after running a marathon, in just a few days, if not hours, faculty are raring to go again!