Search Results
Working Paper
The interplay between preemptive and defensive counterterrorism measures: a two-stage game
A two-stage game depiction of counterterrorism is presented, where the emphasis is on the interaction between the preemptive and defensive measures taken by two targeted countries facing a common threat. The preemptor is likely to be the high-cost defender with the greater foreign interests. A prime-target country may also assume the preemptor role. The analysis identifies key factors - cost comparisons, foreign interests, and targeting risks - that determine counterterrorism allocations. The study shows that the market failures associated with preemptive and defensive countermeasures may be ...
Working Paper
Terrorism, Trade and Welfare: Some Paradoxes and a Policy Conundrum
We present a standard trade model and show that terrorism can be trade inducing, starting from autarky. In addition, terrorism can be shown to be welfare augmenting for a group of nations. Finally, we present some qualitative conditions that identify when a nation?s trade volume may rise (or fall) in response to a greater incidence of terrorism. Our trade and welfare results point to potential difficulties in international coordination of counterterrorism policy because of terrorism?s differential impact across nations.
Working Paper
Foreign aid as counterterrorism policy
We present a model where foreign aid bolsters proactive counterterrorism efforts of a foreign nation that is a source for transnational terrorism. Our two-stage game has the donor country choosing a first-stage contract consisting of terrorism-fighting tied aid and general assistance. In stage 2, the donor decides its defensive measures, while the recipient country chooses its proactive measures. An interesting finding is that the foreign enforcement best-response function is likely to reflect strategic substitutes, while the donor's enforcement best-response function is apt to indicate ...
Working Paper
A Theoretical Treatment of Foreign Fighters and Terrorism
The paper offers a game-theoretical model that includes three participants – the terrorist organization, its foreign fighters, and the adversarial host government. In stage 1, the terrorist group induces foreign fighters to emigrate through wage incentives, while the host government deters these fighters through proactive border security. Foreign fighters decide whether to emigrate from their source country (extensive margin) in stage 2, after which these fighters determine their level of attacks (intensive margin) in stage 3. Comparative statics to the Nash equilibrium are tied to changes ...
Working Paper
Foreign direct investment, aid, and terrorism: an analysis of developing countries
Using a dynamic panel data framework, we investigate the relationship between the two major forms of terrorism and foreign direct investment (FDI). We then analyze how these relationships are affected by foreign aid flows. The analysis focuses on 78 developing countries for 1984- 2008. Our findings suggest that all types of terrorism depress FDI. In addition, aid mitigates the negative effects of total and domestic terrorism on FDI; however, this is not the case for transnational terrorism. This finding highlights that different forms of terrorism call for tailoring mitigating strategies. ...
Journal Article
The effects of terrorism on trade: a factor supply approach
The conventional view of terrorism is that it raises risks and, as a result, reduces trade. The authors use a factor supply approach to show that this hypothesis is not necessarily correct. They use a two-good, two-factor, small open economy model to show that terrorism can either reduce or raise trade depending on critical factors, such as the impact of terrorism on the intensive factor of the export or the import sector. They then extend the analysis to models with several goods and factors and identify conditions under which trade may rise or fall with a greater incidence of terrorism. ...
Journal Article
Terrorism, Trade, and Welfare
For a standard competitive trade model, the authors show that the incidence of terrorism in different nations can affect the pattern of trade. Nations with a greater incidence of terrorism will export goods that are more immune to terrorism-related disruptions, while importing more terrorism-impacted goods. In addition, terrorism can be welfare augmenting for some nations because of terms-of-trade externalities. Finally, the authors present some qualitative conditions that identify when a nation?s trade volume may rise (or fall) in response to a greater incidence of terrorism. Given the ...
Working Paper
Effects of Defensive and Proactive Measures on Competition Between Terrorist Groups
A two-stage game investigates how counterterrorism measures affect within-country competition between two rival terrorist groups. Although such competition is commonplace (e.g., al-Nusra Front and Free Syria Army; Revolutionary Armed Forces of Colombia and the National Liberation Army; and al-Fatah and Hamas), there is no theoretical treatment of how proactive and defensive measures influence this interaction. Previous studies on rival terrorist groups are solely empirical concerning group survival, outbidding, and terrorism level, while ignoring the role that government countermeasures exert ...
Journal Article
The Trade-Offs of Counterterrorism Policies
This article provides a modern overview of counterterrorism tools and their trade-offs for curbing terrorist attacks and their consequences. Defensive and proactive countermeasures constitute two main classes of counterterror tools deployed by targeted governments. The primary drawback of defensive actions, which make terrorist attacks more costly and less apt to succeed, is attack transference that shifts the mode, venue, or target of attacks to those less protected. In contrast, offensive proactive measures, which confront the terrorists directly, may result in backlash as terrorist ...
Working Paper
Politically influenced counterterrorism policy and welfare efficiency
The paper examines how two targeted countries strategically deploy their counterterror forces when lobbying defense firms influence counterterror provision. For proactive measures, lobbying activities in a single targeted country lessen underprovision, raise overall counterterrorism, and reduce terrorism. Welfare decreases in the politically influenced country but increases in the other targeted country owing to enhanced free riding. Lobbying influence on the targeted countries’ welfare is tied to terrorists’ targeting preferences and how the lobbied government weighs citizens’ welfare. ...