Trade and the Spillovers of Transnational Terrorism

José De Sousa (), Daniel Mirza and Thierry Verdier

Swiss Journal of Economics and Statistics (SJES), 2009, vol. 145, issue IV, 453-461

Abstract: We examine the impact of transnational terrorism diffusion on security and international trade. To counter the diffusion of transnational terrorism, targeted governments implement security measures against countries where terror could potentially diffuse. Since security measures raise trade costs, we argue that countries, close enough to those from where terror originates, should experience negative spillovers on their trade. We find evidence for this hypothesis in our data. We show that the closer a country is to a source of terrorism, the higher the negative spillovers on its trade.

Keywords: Terrorism; trade; security (search for similar items in EconPapers)
JEL-codes: F12 F13 (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (22)

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Persistent link: https://EconPapers.repec.org/RePEc:ses:arsjes:2009-iv-7

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