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Why a small probability of terror generates a large macroeconomic impact
Authors:Max Abrahms
Institution:1. maxabrahms@hotmail.com
Abstract:The basic narrative of bargaining theory predicts that, all else equal, anarchy favors concessions to challengers who demonstrate the will and ability to escalate against defenders. For this reason, post-9/11 political science research explained terrorism as rational strategic behavior for non-state challengers to induce government compliance given their constraints. Over the past decade, however, empirical research has consistently found that neither escalating to terrorism nor with terrorism helps non-state actors to achieve their demands. In fact, escalating to terrorism or with terrorism increases the odds that target countries will dig in their political heels, depriving the non-state challengers of their given preferences. These empirical findings across disciplines, methodologies, as well as salient global events raise important research questions, with implications for counterterrorism strategy.
Keywords:Terrorism  Macroeconomic impact
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