The Role of Inclusive Development and Military Expenditure in Modulating the Effect of Terrorism on Governance
Forthcoming, Journal of Economic Studies
35 Pages Posted: 9 Aug 2018
Date Written: January 2018
Purpose - The study investigates the role of inclusive human development and military expenditure in modulating the effect of terrorism on governance.
Design/methodology/approach - It is based on 53 African countries for the period 1998-2012 and interactive Generalised Method of Moments is employed. Six governance indicators from the World Bank and two terrorism variables are used, namely: domestic and transnational terrorism dynamics.
Findings - The following main findings are established. There is a negative net effect on governance (regulation quality and corruption-control) when inclusive human development is used to reduce terrorism. There is a positive net impact on governance (“voice and accountability” and rule of law) when military expenditure is used to reduce domestic terrorism.
Originality/value - We have complemented the sparse literature on the use of policy variables to mitigate the effect of policy syndromes on macroeconomic outcomes.
Keywords: Terrorism; Inclusive Development; Governance; Africa
JEL Classification: C52; D74; F42; O38; P37
Suggested Citation: Suggested Citation