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Understanding the development of fundamentalism

  • Gil Epstein


  • Ira Gang


Fundamentalist organizations and the terrorists they spawn do not arise of a vacuum. Combating terrorism requires understanding the principles of groups’ formation, development and growth. We use economic theory to explain the creation and development of fundamentalist groups. In this paper we develop a theory of fundamentalism and terrorism under which leaders compete to enhance the level of observance of their followers. Our model explains the existence of competing fundamentalist groups and the increase in their intensity over time. Competition among fundamentalists makes them more extreme and may lead to terrorist activity.

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Article provided by Springer in its journal Public Choice.

Volume (Year): 132 (2007)
Issue (Month): 3 (September)
Pages: 257-271

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Handle: RePEc:kap:pubcho:v:132:y:2007:i:3:p:257-271
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  1. Lapan, Harvey E. & Sandler, Todd, 1993. "Terrorism and Signalling," Staff General Research Papers 10808, Iowa State University, Department of Economics.
  2. Laurence R. Iannaccone, 1997. "Toward an Economic Theory of "Fundamentalism"," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 153(1), pages 100-, March.
  3. Timur Kuran, 1989. "Sparks and prairie fires: A theory of unanticipated political revolution," Public Choice, Springer, vol. 61(1), pages 41-74, April.
  4. Ira N. Gang & Gil S. Epstein, 2002. "Government and Cities: Contests and the Decentralization of Decision Making," Departmental Working Papers 200215, Rutgers University, Department of Economics.
  5. Iannaccone, Laurence R, 1992. "Sacrifice and Stigma: Reducing Free-Riding in Cults, Communes, and Other Collectives," Journal of Political Economy, University of Chicago Press, vol. 100(2), pages 271-91, April.
  6. Nitzan, Shmuel, 1994. "Modelling rent-seeking contests," European Journal of Political Economy, Elsevier, vol. 10(1), pages 41-60, May.
  7. Sandler, Todd & Enders, Walter, 2004. "An economic perspective on transnational terrorism," European Journal of Political Economy, Elsevier, vol. 20(2), pages 301-316, June.
  8. Arye L. Hillman & John G. Riley, 1987. "Politically Contestable Rents and Transfers," UCLA Economics Working Papers 452, UCLA Department of Economics.
  9. Daniel G. Arce M. & Todd Sandler, 2003. "An Evolutionary Game Approach to Fundamentalism and Conflict," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 159(1), pages 132-, March.
  10. Eli Berman, 2000. "Sect, Subsidy, and Sacrifice: An Economist's View of Ultra-Orthodox Jews," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 905-953.
  11. Jack Hirshleifer, 1989. "Conflict and rent-seeking success functions: Ratio vs. difference models of relative success," Public Choice, Springer, vol. 63(2), pages 101-112, November.
  12. Dwight Lee & Todd Sandler, 1989. "On the optimal retaliation against terrorists: The paid-rider option," Public Choice, Springer, vol. 61(2), pages 141-152, May.
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