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Aid and the Delegated Fight against Terrorism


  • Azam, Jean-Paul
  • Delacroix, Alexandra


A positive empirical relationship is found between the level of foreign aid received by a country and the number of terrorist attacks originating from it. A simple model is used to explain it, where the donor delegates some actions against terrorism to the aid-recipient government. Aid is endogenous in an econometric equation explaining participation in terrorist events, as expected from the model, and an attacks-supply curve in which aid has a negative impact is presented at the end. Copyright © 2006 The Authors; Journal compilation © 2006 Blackwell Publishing Ltd.
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Suggested Citation

  • Azam, Jean-Paul & Delacroix, Alexandra, 2004. "Aid and the Delegated Fight against Terrorism," IDEI Working Papers 324, Institut d'Économie Industrielle (IDEI), Toulouse, revised Jul 2005.
  • Handle: RePEc:ide:wpaper:3381

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    References listed on IDEAS

    1. Azam, Jean-Paul & Laffont, Jean-Jacques, 2003. "Contracting for aid," Journal of Development Economics, Elsevier, vol. 70(1), pages 25-58, February.
    2. Svensson, Jakob, 2003. "Why conditional aid does not work and what can be done about it?," Journal of Development Economics, Elsevier, vol. 70(2), pages 381-402, April.
    3. Alesina, Alberto & Dollar, David, 2000. "Who Gives Foreign Aid to Whom and Why?," Journal of Economic Growth, Springer, vol. 5(1), pages 33-63, March.
    4. Svensson, Jakob, 2000. "When is foreign aid policy credible? Aid dependence and conditionality," Journal of Development Economics, Elsevier, vol. 61(1), pages 61-84, February.
    5. Alan B. Krueger & Jitka Maleckova, 2003. "Education, Poverty and Terrorism: Is There a Causal Connection?," Journal of Economic Perspectives, American Economic Association, vol. 17(4), pages 119-144, Fall.
    6. Jean-Paul Azam, 2005. "Suicide-bombing as inter-generational investment," Public Choice, Springer, vol. 122(1), pages 177-198, January.
    7. C. S. Adam & S. A. O'Connell, 1999. "Aid, Taxation and Development in Sub-Saharan Africa," Economics and Politics, Wiley Blackwell, vol. 11(3), pages 225-253, November.
    8. Nakamura, Alice & Nakamura, Masao, 1981. "On the Relationships among Several Specification Error Tests Presented by Durbin, Wu, and Hausman," Econometrica, Econometric Society, vol. 49(6), pages 1583-1588, November.
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    Cited by:

    1. Martin Gassebner & Simon Luechinger, 2011. "Lock, stock, and barrel: a comprehensive assessment of the determinants of terror," Public Choice, Springer, vol. 149(3), pages 235-261, December.
    2. Friedrich Schneider & Tilman Brück & Daniel Meierrieks, 2010. "The Economics of Terrorism and Counter-Terrorism: A Survey (Part I)," Discussion Papers of DIW Berlin 1049, DIW Berlin, German Institute for Economic Research.
    3. Brück, Tilman & Xu, Guo, 2012. "Who gives aid to whom and when? Aid accelerations, shocks and policies," European Journal of Political Economy, Elsevier, vol. 28(4), pages 593-606.
    4. Rehman, Faiz Ur & Nasir, Muhammad & Shahbaz, Muhammad, 2017. "What have we learned? Assessing the effectiveness of counterterrorism strategies in Pakistan," Economic Modelling, Elsevier, vol. 64(C), pages 487-495.
    5. Heinrich, Tobias & Kobayashi, Yoshiharu & Bryant, Kristin A., 2016. "Public Opinion and Foreign Aid Cuts in Economic Crises," World Development, Elsevier, vol. 77(C), pages 66-79.
    6. Freytag, Andreas & Krüger, Jens J. & Meierrieks, Daniel & Schneider, Friedrich, 2011. "The origins of terrorism: Cross-country estimates of socio-economic determinants of terrorism," European Journal of Political Economy, Elsevier, vol. 27(S1), pages 5-16.
    7. repec:eee:wdevel:v:98:y:2017:i:c:p:506-522 is not listed on IDEAS
    8. Jean-Paul Azam & Véronique Thelen, 2008. "The roles of foreign aid and education in the war on terror," Public Choice, Springer, vol. 135(3), pages 375-397, June.
    9. Jean-Paul Azam & Véronique Thelen, 2014. "The Geo-Politics of Foreign Aid and Transnational Terrorism," Revue d’économie du développement, De Boeck Université, vol. 22(HS01), pages 263-288.
    10. Subhayu Bandyopadhyay & Todd Sandler & Javed Younas, 2011. "Foreign aid as counterterrorism policy," Oxford Economic Papers, Oxford University Press, vol. 63(3), pages 423-447, July.
    11. Claude Berrebi & Jordan Ostwald, 2011. "Earthquakes, hurricanes, and terrorism: do natural disasters incite terror?," Public Choice, Springer, vol. 149(3), pages 383-403, December.
    12. Paul Bezerra & Alex Braithwaite, 2016. "Locating foreign aid commitments in response to political violence," Public Choice, Springer, vol. 169(3), pages 333-355, December.
    13. Axel Dreher & Andreas Fuchs, 2011. "Does terror increase aid?," Public Choice, Springer, vol. 149(3), pages 337-363, December.
    14. Bassetti, Thomas & Caruso, Raul & Cortes, Darwin, 2015. "Behavioral Differences in Violence: The Case of Intra-Group Differences of Paramilitaries and Guerrillas in Colombia," MPRA Paper 64943, University Library of Munich, Germany.
    15. Campos, Nauro F & Gassebner, Martin, 2009. "International Terrorism, Political Instability and the Escalation Effect," IZA Discussion Papers 4061, Institute for the Study of Labor (IZA).
    16. Nauro F. Campos & Martin Gassebner, 2013. "International Terrorism, Domestic Political Instability, and the Escalation Effect," Economics and Politics, Wiley Blackwell, vol. 25(1), pages 27-47, March.
    17. Joseph Young & Michael Findley, 2011. "Can peace be purchased? A sectoral-level analysis of aid’s influence on transnational terrorism," Public Choice, Springer, vol. 149(3), pages 365-381, December.
    18. Claude Berrebi & Jordan Ostwald, 2011. "Earthquakes, Hurricanes, and Terrorism Do Natural Disasters Incite Terror?," Working Papers WR-876, RAND Corporation.
    19. Claude Berrebi & Jordan Ostwald, 2011. "Earthquakes, hurricanes, and terrorism: do natural disasters incite terror?," Public Choice, Springer, vol. 149(3), pages 383-403, December.
    20. Nasir, Muhammad & Rehman, Faiz Ur & Orakzai, Mejzgaan, 2012. "Exploring the nexus: Foreign aid, war on terror, and conflict in Pakistan," Economic Modelling, Elsevier, vol. 29(4), pages 1137-1145.
    21. Tim Krieger & Daniel Meierrieks, 2011. "What causes terrorism?," Public Choice, Springer, vol. 147(1), pages 3-27, April.
    22. Andrew Boutton, 2014. "US foreign aid, interstate rivalry, and incentives for counterterrorism cooperation," Journal of Peace Research, Peace Research Institute Oslo, vol. 51(6), pages 741-754, November.
    23. Azam, Jean-Paul & Thelen, Véronique, 2012. "Where to Spend Foreign Aid to Counter Terrorism," TSE Working Papers 12-316, Toulouse School of Economics (TSE).

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