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Global terrorism: deterrence versus pre-emption

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  • Todd Sandler
  • Kevin Siqueira

Abstract

This paper analyses two anti-terrorism policies when 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 as the terrorist threat is deflected, while its preemption decision typically gives external benefits when the threat is reduced for all potential targets. With damages limited to home interests, a country will overdeter, while, for globalized terror, a country will underdeter. Pre-emption is usually undersupplied. Leader-follower behaviour is apt to lessen inefficiency for deterrence, but worsen inefficiency for pre-emption, compared with simultaneous-choice equilibrium allocations. Targeted nations can never achieve the proper counterterrorism policy through leadership.

Suggested Citation

  • Todd Sandler & Kevin Siqueira, 2006. "Global terrorism: deterrence versus pre-emption," Canadian Journal of Economics, Canadian Economics Association, vol. 39(4), pages 1370-1387, November.
    • Handle: RePEc:cje:issued:v:39:y:2006:i:4:p:1370-1387
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    References listed on IDEAS

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    1. B. Curtis Eaton, 2004. "The elementary economics of social dilemmas," Canadian Journal of Economics, Canadian Economics Association, vol. 37(4), pages 805-829, November.
    2. Todd Sandler, 2003. "Collective Action and Transnational Terrorism," The World Economy, Wiley Blackwell, vol. 26(6), pages 779-802, June.
    3. Bulow, Jeremy I & Geanakoplos, John D & Klemperer, Paul D, 1985. "Multimarket Oligopoly: Strategic Substitutes and Complements," Journal of Political Economy, University of Chicago Press, vol. 93(3), pages 488-511, June.
    4. Richard Cornes & Roger Hartley & Todd Sandler, 1999. "Equilibrium Existence and Uniqueness in Public Good Models: An Elementary Proof via Contraction," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 1(4), pages 499-509, October.
    5. B. Peter Rosendorff & Todd Sandler, 2004. "Too Much of a Good Thing?," Journal of Conflict Resolution, Peace Science Society (International), vol. 48(5), pages 657-671, October.
    6. Sandler, Todd & Enders, Walter, 2004. "An economic perspective on transnational terrorism," European Journal of Political Economy, Elsevier, vol. 20(2), pages 301-316, June.
    7. Dwight Lee & Todd Sandler, 1989. "On the optimal retaliation against terrorists: The paid-rider option," Public Choice, Springer, vol. 61(2), pages 141-152, May.
    8. Lee, Dwight R, 1988. "Free Riding and Paid Riding in the Fight against Terrorism," American Economic Review, American Economic Association, vol. 78(2), pages 22-26, May.
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    More about this item

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • D62 - Microeconomics - - Welfare Economics - - - Externalities

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