Applying the Full Protection and Security Standard of International Investment Law to Digital Assets

This article considers the possibility that digital assets of foreign investors such as websites and computer systems could be protected by the full protection and security (‘FPS’) standard common to many bilateral investment treaties. Such assets can properly be described as investments and the flexible nature of the FPS standard observed in recent arbitration practice could be extended to cover civil disturbances such as 'cyber attacks' against companies. The article considers host state liability with respect to the prevention of harm to digital assets as well as failure to enforce laws that prohibit it. The lack of governmental control over websites suggests that it would be difficult to ascribe state liability under an FPS clause, except possibly in situations of large scale internet infrastructure collapse. A duty to prosecute attacks against digital assets, while common to many jurisdictions and seen in international instruments, is inappropriate as an investment treaty claim because of difficulties in compensation. The FPS standard further appears to incorporate a degree of contextual proportionality linked to the host state’s resources and this may prevent successful claims against Developing States where many cyber attacks occur

Evolution of Threats in the Global Risk Network

With a steadily growing population and rapid advancements in technology, the global economy is increasing in size and complexity. This growth exacerbates global vulnerabilities and may lead to unforeseen consequences such as global pandemics fueled by air travel, cyberspace attacks, and cascading failures caused by the weakest link in a supply chain. Hence, a quantitative understanding of the mechanisms driving global network vulnerabilities is urgently needed. Developing methods for efficiently monitoring evolution of the global economy is essential to such understanding. Each year the World Economic Forum publishes an authoritative report on the state of the global economy and identifies risks that are likely to be active, impactful or contagious. Using a Cascading Alternating Renewal Process approach to model the dynamics of the global risk network, we are able to answer critical questions regarding the evolution of this network. To fully trace the evolution of the network we analyze the asymptotic state of risks (risk levels which would be reached in the long term if the risks were left unabated) given a snapshot in time, this elucidates the various challenges faced by the world community at each point in time. We also investigate the influence exerted by each risk on others. Results presented here are obtained through either quantitative analysis or computational simulations.Comment: 27 pages, 15 figure

The Global Risks Report 2016, 11th Edition

Now in its 11th edition, The Global Risks Report 2016 draws attention to ways that global risks could evolve and interact in the next decade. The year 2016 marks a forceful departure from past findings, as the risks about which the Report has been warning over the past decade are starting to manifest themselves in new, sometimes unexpected ways and harm people, institutions and economies. Warming climate is likely to raise this year's temperature to 1° Celsius above the pre-industrial era, 60 million people, equivalent to the world's 24th largest country and largest number in recent history, are forcibly displaced, and crimes in cyberspace cost the global economy an estimated US$445 billion, higher than many economies' national incomes. In this context, the Reportcalls for action to build resilience – the "resilience imperative" – and identifies practical examples of how it could be done.The Report also steps back and explores how emerging global risks and major trends, such as climate change, the rise of cyber dependence and income and wealth disparity are impacting already-strained societies by highlighting three clusters of risks as Risks in Focus. As resilience building is helped by the ability to analyse global risks from the perspective of specific stakeholders, the Report also analyses the significance of global risks to the business community at a regional and country-level

Response Functions to Critical Shocks in Social Sciences: An Empirical and Numerical Study

We show that, provided one focuses on properly selected episodes, one can apply to the social sciences the same observational strategy that has proved successful in natural sciences such as astrophysics or geodynamics. For instance, in order to probe the cohesion of a policy, one can, in different countries, study the reactions to some huge and sudden exogenous shocks, which we call Dirac shocks. This approach naturally leads to the notion of structural (as opposed or complementary to temporal) forecast. Although structural predictions are by far the most common way to test theories in the natural sciences, they have been much less used in the social sciences. The Dirac shock approach opens the way to testing structural predictions in the social sciences. The examples reported here suggest that critical events are able to reveal pre-existing ``cracks'' because they probe the social cohesion which is an indicator and predictor of future evolution of the system, and in some cases foreshadows a bifurcation. We complement our empirical work with numerical simulations of the response function (``damage spreading'') to Dirac shocks in the Sznajd model of consensus build-up. We quantify the slow relaxation of the difference between perturbed and unperturbed systems, the conditions under which the consensus is modified by the shock and the large variability from one realization to another

Error and attack tolerance of complex networks

Many complex systems, such as communication networks, display a surprising degree of robustness: while key components regularly malfunction, local failures rarely lead to the loss of the global information-carrying ability of the network. The stability of these complex systems is often attributed to the redundant wiring of the functional web defined by the systems' components. In this paper we demonstrate that error tolerance is not shared by all redundant systems, but it is displayed only by a class of inhomogeneously wired networks, called scale-free networks. We find that scale-free networks, describing a number of systems, such as the World Wide Web, Internet, social networks or a cell, display an unexpected degree of robustness, the ability of their nodes to communicate being unaffected by even unrealistically high failure rates. However, error tolerance comes at a high price: these networks are extremely vulnerable to attacks, i.e. to the selection and removal of a few nodes that play the most important role in assuring the network's connectivity.Comment: 14 pages, 4 figures, Late