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Targeted Killings: Evaluating the Effectiveness of a Counterterrorism Policy

Author

Listed:
  • Asaf Zussman

    (Cornell University)

  • Noam Zussman

    (Bank of Israel)

Abstract

targeted killing (henceforth assassination) of members of Palestinian terrorist organizations was a major element in Israel’s counterterrorism effort during the Palestinian uprising which started in 2000. We evaluate the effectiveness of this policy indirectly by examining Israeli stock market reactions to assassinations. Our approach relies on the assumption that the market should react positively to news of effective counterterrorism measures but negatively to news of counterproductive ones. The main result of the analysis is that the market reacts strongly to assassinations of senior members in Palestinian terrorist organizations: it declines following attempts to assassinate political leaders but rises following attempts to assassinate military ones.

Suggested Citation

  • Asaf Zussman & Noam Zussman, 2005. "Targeted Killings: Evaluating the Effectiveness of a Counterterrorism Policy," Bank of Israel Working Papers 2005.02, Bank of Israel.
    • Handle: RePEc:boi:wpaper:2005.02
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    References listed on IDEAS

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    Cited by:

    1. Cynthia Lum & Leslie W. Kennedy & Alison J. Sherley, 2006. "The Effectiveness of Counter‐Terrorism Strategies," Campbell Systematic Reviews, John Wiley & Sons, vol. 2(1), pages 1-50.

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    More about this item

    Keywords

    Counterterrorism; Stock Market;

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War

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