The Economics of Counterterrorism: A Survey

27 Pages Posted: 11 Jan 2015

See all articles by Friedrich Schneider

Friedrich Schneider

Johannes Kepler University Linz - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Institute for the Study of Labor (IZA)

Tilman Brück

IGZ - Leibniz Institute of Vegetable and Ornamental Crops; ISDC - International Security and Development Center; IZA Institute of Labor Economics

Daniel Meierrieks

WZB Berlin Social Science Center

Date Written: February 2015

Abstract

We provide a review of theoretical and empirical contributions on the economic analysis of terrorism and counterterrorism. We argue that simple rational‐choice models of terrorist behavior – in the form of cost‐benefit models – already provide a well‐founded theoretical framework for the study of terrorism and counterterrorism. We also hint at their limitations which relate to the failure of accounting for the dynamics between terrorism and counterterrorism that may produce unintended second‐order effects as well as for the costs associated with counterterrorism and its international dimension. We reevaluate previously proposed counterterrorism strategies accordingly. Finally, in the light of our findings, we discuss interesting areas of future research.

Keywords: Backlash, Counterterrorism, Rational‐choice models, Terrorism

Suggested Citation

Schneider, Friedrich G. and Brück, Tilman and Meierrieks, Daniel, The Economics of Counterterrorism: A Survey (February 2015). Journal of Economic Surveys, Vol. 29, Issue 1, pp. 131-157, 2015, Available at SSRN: https://ssrn.com/abstract=2547835 or http://dx.doi.org/10.1111/joes.12060

Friedrich G. Schneider (Contact Author)

Johannes Kepler University Linz - Department of Economics ( email )

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Austria
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+43 732 2468 8208 (Fax)

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

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Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Tilman Brück

IGZ - Leibniz Institute of Vegetable and Ornamental Crops ( email )

Theodor-Echtermeyer-Str. 1
Grossbeeren, 14979
Germany

HOME PAGE: http://www.igzev.de

ISDC - International Security and Development Center ( email )

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Berlin, 10117
Germany

HOME PAGE: http://www.isd-center.org

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Daniel Meierrieks

WZB Berlin Social Science Center ( email )

Reichpietschufer
50
Berlin, D-10785
Germany

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