Title: On the assessment of systematic risk in networked systems with multiple types of nodes
Authors: Gaofeng Da - Nanjing University of Aeronautics and Astronautics (China) [presenting]
Abstract: In a networked system, the systematic risks from an attack is a consequence of the network structure formed by connected nodes (e.g., individuals, businesses and computer systems). The most of previous modelling research on assessment of such risks only involves networks with one type of nodes (homogeneous case). We present a more general study on assessment of joint risks of networked systems with multiple types of nodes (heterogeneous case). Under the L-Hop risk propagation model, we investigate the joint distribution for the numbers of compromised nodes with different types. An explicit formula of the joint distribution for a network with arbitrary structure is derived by using a reliability approach. In particular, some simplified formulas for special network topologies such as the complete, ER and complete bi-partite networks are provided. In addition, some useful observations on parameter effects are obtained by conducting a simulation study. Finally, the application in cyber insurance are discussed as well.