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Effects of neighboring nation terrorism on imports

Author

Listed:
  • Subhayu Bandyopadhyay
  • Hristos Doucouliagos
  • Cong S. Pham

Abstract

We consider the effects of terrorism in a home nation and in its neighbors on the home nation's imports. We find that a 10% increase in terrorist attacks in a neighboring nation reduces a country's imports from the rest of the world by approximately $320 million USD, on average. Mediation analysis shows that trading delays is a potential channel of transmission of trade costs of terrorism to a neighbor. We also present a monopolistically competitive theoretical model to throw light on our empirical results.

Suggested Citation

  • Subhayu Bandyopadhyay & Hristos Doucouliagos & Cong S. Pham, 2021. "Effects of neighboring nation terrorism on imports," Southern Economic Journal, John Wiley & Sons, vol. 88(1), pages 144-167, July.
    • Handle: RePEc:wly:soecon:v:88:y:2021:i:1:p:144-167
    DOI: 10.1002/soej.12508
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War

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