Terror Externalities and Trade: An Empirical Analysis
23 Pages Posted: 31 May 2019 Last revised: 1 Jun 2019
Date Written: 2019-05-29
We report robust evidence of adverse cross-border externalities from terrorism on trade for over 160 countries from 1976 to 2014. Terrorism in one country spills over to reduce trade in neighboring nations. These externalities arise from higher trade costs due to trade delays and macroeconomic uncertainty.
Keywords: Terrorism, Spillovers, Bilateral imports
JEL Classification: D74, F14, H56
Suggested Citation: Suggested Citation