The Economic Repercussions of Terrorism

by Buesa, Mikel; Baumert, Thomas

• ISBN13: 9780199577705
• ISBN10: 0199577706
• Format: Hardcover
• Copyright: 2010-03-19
• Publisher: Oxford University Press

Summary

The Economic Repercussions of Terrorismoffers a theoretical overview of the economics of terrorism and provides a detailed evaluation of the costs of terrorist attacks, focusing in particular on the Madrid bombings of 2004, but also including comparisons with 9/11 and the London bombings of 7/7. Divided into three parts, Part One offers a theoretical overview of the economics of terrorism including an analysis of the roots of terrorism, terrorist financing, the economic consequences of terrorism, and the predatory war economy. Part Two provides an in-depth analysis of the direct and indirect economic costs of terrorist attacks, looking at the security and defence responses, and offering industry sector analyses. Part Three explores the 'other costs' of terrorism, such as the impact of attacks on a government's popularity, and the possibility that terrorists use 'inside information' on attacks to play the stock market.

Author Biography

Professor Mikel Buesa is Professor of Applied Economics at the Complutense University of Madrid (UCM) and Head of the Chair of the Economics of Terrorism. He is widely published on the subject of terrorism and the economy and is president of two Spanish civic organizations devoted to promotion of intellectual and political work on counter-terrorism. Professor Thomas Baumert is Professor of Economics at the Catholic University of Valencia and Vice-Dean of the Faculty of Economics and Business Studies. His research areas include the economics of terrorism, especially on the impact of terrorist attacks on financial markets.

Table of Contents

Figures and Tables	p. xi
Editors	p. xiii
Contributors	p. xv
Preface	p. xvii
A Theoretical Approach to the Economics of Terrorism
The Economics of Terrorism: An Overview of Theory and Applied Studies	p. 3
Introduction	p. 3
Definition and Types of Terrorism	p. 4
Precedents	p. 5
Data Sources	p. 7
Economic Analysis of the Causes of Terrorism	p. 9
Financing Terrorism	p. 13
Economic Analysis of the Consequences of Terrorism: Economic Effects	p. 15
Anti-terrorist Policies	p. 24
Areas Needing Further Study	p. 27
War and Terrorism: The Predatory War Model	p. 37
Introduction	p. 37
Modern War and the War Economy	p. 37
The Breakup of Moral Principle in Modern War	p. 40
Terrorist Wars	p. 43
The Predatory War Economy	p. 46
The Economic and Social Consequences of Terrorist War	p. 48
Conclusions	p. 55
Assessing the Costs of Terrorism
The Economic Cost of 3/11	p. 61
Introduction	p. 61
Rescue and the Initial Care of the Victims of the Attacks	p. 65
The Health Services	p. 67
Compensation to the Victims	p. 68
Wage Losses of the Injured	p. 72
Damage to Infrastructure and Housing	p. 74
Pavilion 6 in IFEMA	p. 75
Psychological Care of the Victims	p. 75
The Cost of Solidarity: The Demonstration of 3/12	p. 77
Conclusions	p. 78
Security and Defence Policies in Spain after 3/11: An Economic Assessment	p. 81
Introduction	p. 81
Actions Taken by the Central Administration	p. 82
Community of Madrid and Madrid City Council	p. 92
Transport Companies: Madrid Airport-Madrid Metro-RENFE	p. 92
Private Security	p. 94
Summary and Conclusions	p. 97
Security and Defence Policies in Europe: A Response to Islamic Terrorism	p. 101
Introduction	p. 101
The Concepts of Security and Defence in Terrorism	p. 102
Reactions in Europe to Jihadist Attacks	p. 104
Conclusions	p. 126
Direct and Sectoral Impact of the 3/11 Attacks on the Economy of the Community of Madrid	p. 129
Introduction	p. 129
The Global Economic Impact of 3/11 According to Current Indicators	p. 130
Tourism	p. 146
The Transport Sector	p. 154
Impact in Other Sectors	p. 161
Conclusions	p. 164
Other Costs Resulting from Terrorist Attacks
The Impact of Terrorist Attacks on the Stock Markets	p. 173
Introduction	p. 173
How Stock Markets React to Terrorist Attacks	p. 174
Previous Studies	p. 176
A Comparative Study of the Impact of the Islamic Attacks on New York-Washington (9/11), Madrid (3/11), and London (7/7)	p. 179
Can the Attacks Serve as a Source of Financing for Terrorism?	p. 189
Conclusions	p. 193
The Effect of the Terrorist Attacks on the Outcome of the 2004 Spanish Election: A Survey	p. 199
Introduction	p. 199
'Bombing' and 'Voting'	p. 200
Voting after the 3/11 Terrorist Attacks: A Survey of the Literature	p. 203
Discussion of the Results	p. 213
Conclusions	p. 214
Index	p. 217
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