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Economics and Terrorism: What We Know, What We Should Know and the Data We Need

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  • Llussá, Fernanda
  • Tavares, José

Abstract

In this paper we organize the literature on the economics of terrorism around seven different topics, offering a comprehensive view of the literature with a view to identifying questions that remain unanswered. The chosen topic areas are: The Measurement of Terrorist Activity, The Nature of Terrorists, The Utility Cost of Terrorism, The Impact of Terrorism on Aggregate Output, Terrorism and Specific Sectors of Activity, Terrorism and Economic Policy, and Counter-Terrorism. In a sense, we proceed from measurement issues to studies of the characteristics of terrorists and terrorist organizations, the consequences of terrorism on individual utility and, aggregate output and on specific sectors of activity, as well as the impact of terrorism on fiscal and monetary policies. We conclude with an examination of the economics literature on counter-terrorism measures. For each of the topics above, we present what the literature has achieved, the important questions that remain open and the type of data that would help researchers make progress. In our discussion, we identify the main papers in the literature and the issue(s) where each made a contribution, presenting a brief individual summary for these papers, organized along the topic areas.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6509.

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Date of creation: Oct 2007
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Handle: RePEc:cpr:ceprdp:6509

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Related research

Keywords: Counter-Terrorism; Economics of Terrorism; Nature of Terrorists; Output Costs; Utility Costs;

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Cited by:
  1. Friedrich Schneider & Tilman Brück & Daniel Meierrieks, 2011. "The Economics of Terrorism and Counter-Terrorism: A Survey (Part II)," Economics of Security Working Paper Series 45, DIW Berlin, German Institute for Economic Research.
  2. Friedrich Schneider & Raul Caruso, 2011. "The (Hidden) Financial Flows of Terrorist and Transnational Crime Organizations: A Literature Review and Some Preliminary Empirical Results," Economics of Security Working Paper Series 52, DIW Berlin, German Institute for Economic Research.
  3. Tilman Brück & Fernanda Llussá & José Tavares, 2010. "Perceptions, Expectations, and Entrepreneurship: The Role of Extreme Events," HiCN Working Papers 87, Households in Conflict Network.
  4. Srijit Mishra, 2011. "Conflict resolution through mutuality: Lessons from Bayesian updating," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2011-001, Indira Gandhi Institute of Development Research, Mumbai, India.
  5. Cathérine Müller & Joppe de Ree, 2009. "The Threat of Terrorism: The Perspective of a Policy-Maker," Economics of Security Working Paper Series 3, DIW Berlin, German Institute for Economic Research.
  6. Campos, Nauro F. & Gassebner, Martin, 2009. "International Terrorism, Political Instability and the Escalation Effect," CEPR Discussion Papers 7226, C.E.P.R. Discussion Papers.
  7. Schneider, Friedrich, 2010. "The (Hidden) Financial Flows of Terrorist and Organized Crime Organizations: A Literature Review and Some Preliminary Empirical Results," IZA Discussion Papers 4860, Institute for the Study of Labor (IZA).
  8. Srijit Mishra, 2002. "Understanding fundamentalist belief through Bayesian updating," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2003-002, Indira Gandhi Institute of Development Research, Mumbai, India.
  9. Shahbaz, Muhammad & Shabbir, Shahbaz Muhammad, 2011. "Is hike in inflation responsible for rise in terrorism in Pakistan?," MPRA Paper 31236, University Library of Munich, Germany, revised 29 May 2011.
  10. Shahbaz, Muhammad, 2013. "Linkages between inflation, economic growth and terrorism in Pakistan," Economic Modelling, Elsevier, vol. 32(C), pages 496-506.

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