Does terrorism work?

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This paper examines whether terrorism is an effective tool for achieving political goals. By exploiting geographic variation in terror attacks in Israel from 1988 to 2006, we show that local terror attacks cause Israelis to be more willing to grant territorial concessions to the Palestinians. These effects are stronger for demographic groups that are traditionally right-wing in their political views. However, terror attacks beyond a certain threshold cause Israelis to adopt a less accommodating position. In addition, terror induces Israelis to vote increasingly for right-wing parties, as the right-wing parties move to the left in response to terror. Hence, terrorism appears to be an effective strategy in terms of shifting the entire political landscape to the left, although we do not assess whether it is more effective than non-violent means.

Original languageAmerican English
Pages (from-to)1459-1510
Number of pages52
JournalQuarterly Journal of Economics
Issue number4
StatePublished - Nov 2010

Bibliographical note

Funding Information:
∗We thank Robert Barro, Larry Katz, Omer Moav, Daniele Paserman, and the anonymous referees for helpful comments and suggestions. We also benefited from the comments of audiences at Boston University, Tel Aviv University, the University of Chicago, the NBER 2009 Summer Institute (Economics of National Security Group), the conference on “The Political Economy of Terrorism and Insurgency” at UC San Diego, and the 2010 meetings of the American Economic Association. Noam Michelson provided expert research assistance. Esteban Klor thanks the NBER and Boston University for their warm hospitality while he was working on this project. The authors thank the Maurice Falk Institute for Economic Research and the Israeli Science Foundation for financial support.


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