Economic Inequality, Ethnic Group Dynamics, and Domestic Terrorism : The Destructive Effects of Collectively Experienced Grievances

This paper studies how economic inequality between ethnic groups affects domestic terrorism. Drawing on theories concerning horizontal inequality, ethnic group dynamics, political violence, and domestic terrorism, the following hypothesis is developed: Increased economic inequality between ethnic groups increases domestic terrorism. In order to test the hypothesis and answer the research question, an ordinary least squares (OLS) regression analysis is conducted using a country-year dataset containing relevant control variables and a total of 2837 observations. The results yielded evidence that supports the hypothesis and the supposition that the economic inequality between ethnic groups, on average, increases domestic terrorist attacks. This central finding could, due to its novelty, yield significant academic and policy implications. However, as a consequence of the inherent challenges of the complicated object of study and of limitations in the research design, more rigorous investigation is needed in order to compliment, rectify or consolidate the reliability and validity of the findings