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Earthquakes and terrorism: The long lasting effect of seismic shocks

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  • Montalvo, José G.
  • Reynal-Querol, Marta

Abstract

The literature on the effect of shocks on civil conflicts has grown rapidly over the last decade. In this paper, we study the relationship between earthquakes and terrorism. In the short run, the destruction generated by a medium-range earthquake reduces the opportunity cost of rebelling against the government. Since destruction of infrastructures in these cases is limited, the state keeps most of its coercive capacity, which reduces the chances of full-fledged conflict but leaves open the possibility of low intensity rebellious acts such as terrorism. In the medium run the destruction of tangible assets can lead to the closing down of weak firms, the introduction of new technologies, the improvement of productivity and the increase in wealth inequality We propose a new algorithm to classify terrorism events as domestic or transnational, and show that the likelihood of a domestic terrorist event increases with the previous occurrence of an earthquake. Using earthquakes as an instrument for income, we also show that development has a positive and significant effect on the likelihood of terrorist events.

Suggested Citation

  • Montalvo, José G. & Reynal-Querol, Marta, 2019. "Earthquakes and terrorism: The long lasting effect of seismic shocks," Journal of Comparative Economics, Elsevier, vol. 47(3), pages 541-561.
  • Handle: RePEc:eee:jcecon:v:47:y:2019:i:3:p:541-561
    DOI: 10.1016/j.jce.2019.05.003
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    More about this item

    Keywords

    Local terrorism; Earthquakes; Persistence;
    All these keywords.

    JEL classification:

    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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