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Terrorism Financing, Recruitment and Attacks

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  • Nicola Limodio

Abstract

This paper investigates the effect of terrorism financing and recruitment on attacks. A Sharia-compliant institution in Pakistan induces exogenous variation in the funding of terrorist groups through their religious affiliation. I isolate the supply of terrorist attacks by following multiple terrorist groups with different affiliations operating in various cities. Higher terrorism financing, in a given location and period, generates more attacks in the same location and period. This effect increases in recruitment, measured through darkweb data, inputs by two judges and machine-learning. This evidence is consistent with terrorist organizations facing financial frictions to their internal capital market. JEL: G30, H56 Keywords: Terrorism, Finance

Suggested Citation

  • Nicola Limodio, 2020. "Terrorism Financing, Recruitment and Attacks," Working Papers 665, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  • Handle: RePEc:igi:igierp:665
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    References listed on IDEAS

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    Cited by:

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    2. Thiemo Fetzer & Pedro C. L. Souza & Oliver Vanden Eynde & Austin L. Wright, 2021. "Security Transitions," American Economic Review, American Economic Association, vol. 111(7), pages 2275-2308, July.
    3. Edoardo Chiarotti & Nathalie Monnet, 2019. "Hit them in the Wallet! An Analysis of the Indian Demonetization as a Counter-Insurgency Policy," IHEID Working Papers 03-2019, Economics Section, The Graduate Institute of International Studies.
    4. Stoop, Nik & Verpoorten, Marijke & van der Windt, Peter, 2019. "Artisanal or industrial conflict minerals? Evidence from Eastern Congo," World Development, Elsevier, vol. 122(C), pages 660-674.
    5. Marco Alfano & Joseph-Simon Gorlach, 2019. "Terrorism, education and the role of expectations: evidence from al-Shabaab attacks in Kenya," Working Papers 1904, University of Strathclyde Business School, Department of Economics.
    6. Claudia Custodio & Bernardo Mendes & Diogo Mendes, 2021. "Firm responses to violent conflicts," NOVAFRICA Working Paper Series wp2106, Universidade Nova de Lisboa, Faculdade de Economia, NOVAFRICA.

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    More about this item

    Keywords

    terrorism; finance;

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War

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