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The Economic Consequences of Terror: A Brief Survey

Author

Listed:
  • Tilman Brück

    () (German Institute for Economic Research (DIW Berlin))

  • Bengt-Arne Wickström

    () (Humboldt University of Berlin)

Abstract

This brief survey reviews the economic consequences of terrorism. It is argued that the indirect effects of terrorism are likely to outweigh the direct effects. The former include changes in risk, transaction costs, demand, public finances and growth. We also address the nature of anti-terrorist policy and of policies reducing the negative impact of terrorism. The former can change the incentives for terrorists to break with social conventions or maximize the costs of conducting terrorism. The latter is particularly important as badly designed policies could enhance the negative economic effects of terrorist actions.

Suggested Citation

  • Tilman Brück & Bengt-Arne Wickström, 2004. "The Economic Consequences of Terror: A Brief Survey," HiCN Working Papers 03, Households in Conflict Network.
  • Handle: RePEc:hic:wpaper:03
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    References listed on IDEAS

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    Cited by:

    1. Johanna Garnitz & Gernot Nerb, 2016. "ifo Weltwirtschaftsklima trübt sich weiter ein – Ergebnisse des 131. World Economic Survey (WES) für das erste Quartal 2016," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 69(04), pages 70-82, February.
    2. Cristina Elena ALBU, 2016. "Tourism And Terrorism: A Worldwide Perspective," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 8(1), pages 1-19, March.
    3. Bassil Charbel, 2013. "Macroeconomic Consequences of War and Terrorism in Lebanon," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 19(3), pages 415-429, December.
    4. Gul, Tayyeba Gul & Hussain, Anwar Hussain & Bangash, Shafiqullah Bangash & Khattak, Sanam Waghma Khattak, 2010. "Impact of Terrorism on Financial Markets of Pakistan (2006-2008)," MPRA Paper 41990, University Library of Munich, Germany.
    5. Paul Benjamin & Carola Gruen, 2006. "The Regulatory Efficiency of the CCMA: A Statistical Analysis of the CCMA’s CMS Database," Working Papers 06110, University of Cape Town, Development Policy Research Unit.
    6. Axel Dreher & Martin Gassebner & Lars-H. Siemers, 2010. "Does Terrorism Threaten Human Rights? Evidence from Panel Data," Journal of Law and Economics, University of Chicago Press, vol. 53(1), pages 65-93, February.

    More about this item

    Keywords

    terror; terrorism; security policy;

    JEL classification:

    • A31 - General Economics and Teaching - - Multisubject Collective Works - - - Multisubject Collected Writings of Individuals
    • N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative

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