The Economic Impact of Terrorism from 2000 to 2018

Bardwell Harrison and Iqbal Mohib ()
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Bardwell Harrison: Institute for Economics and Peace, Sydney, NSW, Australia
Iqbal Mohib: Institute for Economics and Peace, Sydney, NSW, Australia

Peace Economics, Peace Science, and Public Policy, 2021, vol. 27, issue 2, 227-261

Abstract: This paper estimates the economic impact of terrorism at $US 33 billion in 2018. In the 18 years from 2000 to 2018, terrorism cost the world economy $US 855 billion. This model follows the methodology of the 2019 Global Terrorism Index and uses a bottom-up cost accounting approach to aggregate the cost of four indicators that result from the incidents of terrorism. The four indicators include terrorism-related deaths, injuries, property damage and GDP losses. The findings of this paper show that global terrorism peaked in 2014 with 33,555 deaths globally and a consequential economic impact of $US 111 billion. From 2011 to 2014, terrorism-related deaths increased by 353%, and terrorist incidents rose by 190%. The 100 incidents with the highest economic impact from deaths and injuries are included in the analysis. The September 11, 2001 attacks in the United States stands as the incident with the highest economic impact accounting for deaths and injuries only at $US 40.6 billion, this is followed by the Sinjar massacre in Sinjar, Nineveh, Iraq at $US 4.3 billion.

Keywords: terrorism; economic cost; economic impact; GDP losses; violence; terrorism tactics (search for similar items in EconPapers)
JEL-codes: D74 F51 H56 I15 (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1515/peps-2020-0031

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