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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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    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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