The economics of terrorism: An economic perspective to terrorists’ psychology

Abstract

Terrorism has endured the constraints of time and mankind, prevailing for as long as mankind has existed, although maturing into an altogether different symbolization in today’s contemporary world. There has been much heated debate on how such acts of violence are labelled and defined and what fundamentally constitutes terrorism. Thus, this paper initially contemplates the different interpretations of terrorism. It then goes on to analyse the existing evidence on the causes of terrorism, while demonstrating the economic assumptions about human behaviour critical for further analysis. It then goes into an in-depth analysis of the microeconomic and macroeconomic variables that come into play while studying the interrelation between terrorism and economics. It incorporates analysis of the level of knowledge about the causal chains between macroeconomic conditions and the frequency and quality of terrorism. It also assembles the knowledge on the impact of terrorism on the economy at micro and macro levels, while apprising the variables liable for such ramifications. It touches on the subject of counter-terrorism and finally concludes by conferring projected solutions to the exhaustive issue of terrorism and what policies governments around the globe have adopted to combat terrorism and their further implications on terrorism. (200 words)