Sandler, Todd; & Sigueira, Kevin (2006) Global Terrrorism: Deterrence versus Pre-emption , Canadian Journal of Economics 39(4): 1370–1387.
This paper analyzes two anti-terrorism policies deterrence and preemption in an environment where a targeted nation's people and property are in jeopardy at home and abroad. A country's deterrence decision involves both external benefits and costs, while its preemption decision only gives external benefits. With damages limited to home interests, a country will overdeter, while, for globlized terror, a country will underdeter. Preemption is always undersupplied. Leader-follower behavior is apt to lessen inefficiency for deterrence, but worsens inefficiency for preemption as compared with Nash behavior. Policy conclusions are drawn.
Vibhooti Shukla Professor of Economics and Political Economy, School of Economic, Political & Policy Science, University of Texas at Dallas
The Peace Research Institute Oslo (PRIO) conducts research on the conditions for peaceful relations between states, groups and people.