When Does Terrorism Occur: Game-Theoretic Analysis and Offense-Defense Balance

Abstract

Offense-defense theory argues that wars are more likely in offense-dominant periods. I study how this claim can be challenged when it comes to making predictions about terrorism. To do so, I consider a model of continuous-time conflict between a status quo state and a terrorist, who develops offensive military technology and has private information on its aggressiveness. I characterize two measures of offense-defense balance, and show that a greater offense advantage in the balance is not associated with a higher risk of terrorism. This paper supports the critics of offense-defense theory, and provides insights into understanding when terrorism occurs.

Keywords: terrorism, game theory, offense-defense balance, military technology.

JEL Classification: C72, D74, D82, F51