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Micro-economic analysis of international terrorism
The objective of this work is to explore two different types of anti-terrorist policies and examine their reaction to distinct types of terrorists' motivation.
Details
| language |  | english |
| wordcount |  | 16842 (cca 48 pages) |
| contextual quality |  | N/A |
| language level |  | N/A |
| price |  | free |
| sources |  | 54 |
Table of contents
Introduction 1
1 Economic motivation for investigating terrorism and brief history of terrorism 3
1.1 Economic areas influenced by terrorism 3
1.2 Basic statistics 5
1.2.1 Methods of empirical research 6
1.2.2 Look at the data 6
1.3 Brief history and trends 8
2 Classification of key players and our assumptions 11
2.1 Rationality 11
2.2 Definition of key players 12
2.2.1 Government 12
2.2.2 Terrorists 13
2.3 Terrorists\' utility functions 15
2.3.1 Parameters of utility function 15
2.3.2 Become terrorist or remain peaceful 17
2.3.3 Expected utility 20
2.3.4 Costs and Benefits of Terrorism 21
3 Anti-Terrorism Policies 23
3.1 Deterrence 23
3.2 \"Carrot policy\" 27
3.2.1 Education 29
3.2.2 Positive sanctions 31
3.2.3 Political and economic decentralization 34
3.2.4 Political integration 36
3.3 Income Effect and Substitution Effect 36
4 Static game theory models 38
4.1 Interaction between government and terrorists 38
4.2 Join effect of deterrence and positive incentives 40
4.2.1 Terrorists with non-nihilist preferences 41
4.2.2 Terrorists with nihilist preferences 44
Conclusion 47
APPENDIX 1 - Transnational Terrorism: Events 1968 - 2000
Preview of the essay: Micro-economic analysis of international terrorism
Terrorism appears to be a global challenge for the policy-makers of democratic countries and it becomes an issue of contemporary economics. The economics of terrorism is based on the rational choice approach. This approach offers to look at the terrorists as on the rational economic actors and thus to use classic economic tools as the decision-making calculus based on marginal utility or the cost-benefit analysis. We use these approaches to compare two totally different anti-terrorism policies - deterrence and positive policy. Deterrence has been a crucial way in fighting terrorism and it has been widely in recent years. On the contrary, the positive policy, also called "policy of benevolence", seems to be ...
... applied positive policy can implicate higher aggregate payoff than deterrence. Moreover, it can have long-lasting effect based on changes in terrorists' motivation and it is able to create positive externality for the society as a whole. But it is argued in chapter 4 that if we examine the joint effect of both anti-terrorism policies we derive that the positive policy is selected by both players only if it's net private benefits are positive and higher than net private benefit of deterrence.
Essay is in categories
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Economics
/Economics
/Microeconomics
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Economics
/International Business
/Comments
Princess R.I guess the presentation is more or less reflective of his previous writings. But nice discussion though.