A theoretical treatment of foreign fighters and terrorism

The paper offers a baseline game-theoretical model. Initially, the terrorist group induces foreign fighters through wage incentives to emigrate from their source or home country to join the terrorist group in a country hosting, but not supporting, the group. At the same time, the government hosting the terrorist group deters these fighters through proactive border security measures. Foreign fighters subsequently decide whether to emigrate from their source country to another hosting the terrorists. The foreign fighters’ emigration decision determines the size of the terrorist group abroad, and, thus, the group’s extensive margin. Comparative statics to the Nash equilibrium concern changes in the source-country employment opportunity and changes in foreign fighters’ radicalization. When the source-country employment improves, wage incentives for these fighters and proactive measures at the border increase, but the supply of foreign fighters must fall. Enhanced radicalization decreases wage incentives and proactive measures. An extension involves an augmented game with the host-country government assuming a leadership role, resulting in welfare gains for the adversaries. Without government leadership, another modeling extension permits foreign fighters to decide their effort level (known as the group’s intensive margin) in the game’s final stage.