Terrorism: Deterrence May Backfire

Bruno Frey and Simon Luechinger

No 136, IEW - Working Papers from Institute for Empirical Research in Economics - University of Zurich

Abstract: Present anti-terrorist policy concentrates almost exclusively on deterrence. It seeks to fend off terrorism by raising the cost of undertaking terrorist acts. This paper argues that deterrence policy is less effective than generally thought and induces in some cases even more terrorism. This is, in particular, the case if deterrence policy induces a centralisation of decision-making in the polity and economy. Therefore, an effective anti-terrorist policy should focus more on reducing the expected benefits of terrorist acts to prospective terrorists. Such a policy is based on strengthening rather than weakening decentralised decision-making.

Keywords: Terrorism; Deterrence; Decentralization; Democracy; Federalism; Market Economy; Rational Choice; Motivation (search for similar items in EconPapers)
JEL-codes: D74 F00 H56 K42 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-his, nep-law and nep-pbe
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Citations: View citations in EconPapers (18)

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