International Trade, Security, and Transnational Terrorism: Theory and Empirics

In this paper, we offer a general analytical framework to illustrate the complex two-way interactions between trade and transnational terrorism. We then survey the recent economic literature in light of this framework by pointing to the importance in empirical studies of a) controlling appropriately for theses interactions, b) distinguishing between ”source ” countries and ”target ” countries of terrorism, and c) taking into account the intertemporal persistence of terrorism between specific pairs of countries