A Theoretical Treatment of Foreign Fighters and Terrorism

Subhayu Bandyopadhyay and Todd Sandler

No 2024-011, Working Papers from Federal Reserve Bank of St. Louis

Abstract: The paper offers a game-theoretical model that includes three participants – the terrorist organization, its foreign fighters, and the adversarial host government. In stage 1, the terrorist group induces foreign fighters to emigrate through wage incentives, while the host government deters these fighters through proactive border security. Foreign fighters decide whether to emigrate from their source country (extensive margin) in stage 2, after which these fighters determine their level of attacks (intensive margin) in stage 3. Comparative statics to the Nash equilibrium are tied to changes in the employment or opportunity cost in the source country, as well as to changes in radicalization. Our basic model provides a theoretical foundation to recent empirical results. An extension involves a four-stage game with the host government assuming a leadership role prior to the terrorist group choosing its wage incentive.

Keywords: foreign fighters; extensive and intensive margins; three-stage game; selective incentives; proactive border security (search for similar items in EconPapers)
JEL-codes: C72 D74 H56 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2024-05
New Economics Papers: this item is included in nep-gth and nep-int
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DOI: 10.20955/wp.2024.011

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