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Al Qaeda and Jihadist Terrorism in the Light of Contest Theory, Empirical Evidence for the period 2004-2008

  • Caruso, Raul
  • Schneider, Friedrich

This paper finds an empirical evidence that al Qaeda behaves as a contest organizer rewarding a prize to candidate extremist groups. Would-be terrorists must then compete with each other to prove their commitment and ability. Hence to maximize their own probability of winning the prize, each group (maximizes its effort). In particular, in the presence of costless information each candidate group can observe the results of attacks of other groups. Therefore, each group tries to make attacks at least equally destructive as the foregoing attacks. The testable implication is that: the number of victims of terrorist attacks is associated with the number of victims of past attacks. Resulting evidence confirms the hypothesis. However, results show that al Qaeda-style jihadist terrorist activity depends also upon grievance for poverty and socio-economic conditions.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 15856.

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Date of creation: Jun 2009
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Handle: RePEc:pra:mprapa:15856
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  1. Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-98, December.
  2. J. Atsu Amegashie & C. Bram Cadsby & Yang Song, 2005. "Competitive Burnout: Theory and Experimental Evidence," Working Papers 0507, University of Guelph, Department of Economics and Finance.
  3. Sandler, Todd & Enders, Walter, 2004. "An economic perspective on transnational terrorism," European Journal of Political Economy, Elsevier, vol. 20(2), pages 301-316, June.
  4. Efraim Benmelech & Claude Berrebi, 2007. "Human Capital and the Productivity of Suicide Bombers," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 223-238, Summer.
  5. Nti, Kofi O, 1999. "Rent-Seeking with Asymmetric Valuations," Public Choice, Springer, vol. 98(3-4), pages 415-30, March.
  6. Alberto Abadie, 2006. "Poverty, Political Freedom, and the Roots of Terrorism," American Economic Review, American Economic Association, vol. 96(2), pages 50-56, May.
  7. Andreas Freytag & Jens J. Krüger & Daniel Meierrieks & Friedrich Schneider, 2009. "The Origins of Terrorism - Cross-Country Estimates on Socio-Economic Determinants of Terrorism," Jena Economic Research Papers 2009-009, Friedrich-Schiller-University Jena.
  8. Sherwin Rosen, 1985. "Prizes and Incentives in Elimination Tournaments," NBER Working Papers 1668, National Bureau of Economic Research, Inc.
  9. Moldovanu, Benny & Sela, Aner, 1999. "The Optimal Allocation of Prizes in Contests," Sonderforschungsbereich 504 Publications 99-75, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
  10. Morgan, John & Vardy, Felix, 2007. "The value of commitment in contests and tournaments when observation is costly," Games and Economic Behavior, Elsevier, vol. 60(2), pages 326-338, August.
  11. Berrebi Claude, 2007. "Evidence about the Link Between Education, Poverty and Terrorism among Palestinians," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 13(1), pages 1-38, December.
  12. Nti, Kofi O., 2004. "Maximum efforts in contests with asymmetric valuations," European Journal of Political Economy, Elsevier, vol. 20(4), pages 1059-1066, November.
  13. Raul Caruso & Andrea Locatelli, 2005. "Pushing the Prize Up, A Few Notes on Al-Qaeda's Reward Structure and the choice of Casualties," Public Economics 0507008, EconWPA.
  14. Moldovanu, Benny & Sela, Aner & Shi, Xianwen, 2005. "Contests for Status," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 139, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  15. O'Keeffe, Mary & Viscusi, W Kip & Zeckhauser, Richard J, 1984. "Economic Contests: Comparative Reward Schemes," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 27-56, January.
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