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Does Terrorism Have Economic Roots?

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  • Pinar Derin-Güre

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Abstract

This paper investigates the roots of international, domestic, and separatist terrorism using a new, extensive, multi-country panel data set obtained from MIPT (Memorial Institute of Prevention of Terrorism). I augment the MIPT data by recording the target country and the terrorist's country of origin. I also classify each terrorist incident as international, domestic or separatist. International terrorism refers to terrorism committed by foreign nationals. Domestic terrorism refers to terrorism committed by domestic nationals. Separatist terrorism is committed by domestic nationals engaged in separatist causes. Using a panel data analysis with country fixed effects, I find striking results at considerable odds with the literature. Whereas the previous literature finds that terrorism is unrelated to economic conditions, I find that the richer the country, the fewer the terrorist attacks committed abroad by the country's nationals. Similarly, I find that when a country is richer, the country's nationals commit fewer terrorist attacks at home. I build an entirely new data set with regional GDP of separatist regions and find that the higher the GDP of the separatist region, the fewer the terrorist attacks committed by native separatists.

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Bibliographic Info

Paper provided by Boston University - Department of Economics in its series Boston University - Department of Economics - Working Papers Series with number wp2009-001.

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Length: 47
Date of creation: May 2009
Date of revision:
Handle: RePEc:bos:wpaper:wp2009-001

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Keywords: Economics of Terrorism; Count Data; International Terrorism; Domestic Terrorism; Separatist Terrorism;

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Cited by:
  1. Boehmer Charles & Daube Mark, 2013. "The Curvilinear Effects of Economic Development on Domestic Terrorism," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 19(3), pages 359-368, December.
  2. Essaddam, Naceur & Karagianis, John M., 2014. "Terrorism, country attributes, and the volatility of stock returns," Research in International Business and Finance, Elsevier, vol. 31(C), pages 87-100.

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