Economic Conditions and Terrorism
We explore the links between the incidence of terrorism and the state of a country's economy. Groups that are unhappy with the current economic status quo, yet unable to bring about drastic institutional changes, may find it rational to engage in terrorist activities. The result is a pattern of reduced economic activity and increased terrorism. In contrast, an alternative environment can emerge where access to economic resources is more abundant and terrorism is reduced. Our empirical results are consistent with the theory. We find that for democratic, high income countries, economic contractions lead to increased likelihood of terrorist activities.
© 2004 Elsevier B.V.
S.Brock Blomberg, Gregory D. Hess, Akila Weerapana, Economic conditions and terrorism, European Journal of Political Economy, Volume 20, Issue 2, June 2004, Pages 463-478, ISSN 0176-2680, 10.1016/j.ejpoleco.2004.02.002. (http://www.sciencedirect.com/science/article/pii/S0176268004000217)