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date: 23 September 2019

The Causes and Consequences of Terrorism in Africa

Abstract and Keywords

African countries have experienced relatively high levels of terrorism. Terrorism has been linked to the theory of deprivation, but the extent to which terrorism is an economic good can be explained using a rational choice model of economic agents. Terrorism is also possibly motivated largely by existential other-worldly goals. If terrorism reflects a solution to a problem with identifiable costs and benefits that accord with the behavior assumed in economic theory, then it may be possible to contain terrorism by altering those costs and benefits. Terrorism as a manifestation of conflict could be a historically persistent phenomena with roots in the past. This chapter examines the causes and consequences of terrorism in Africa, and considers the extent to which existing evidence rationalizes the various explanations for it, and its implications for counterterrorism policy in Africa.

Keywords: Africa, Terrorism, Economics Development, Counter-terrorism Policy, National Security

39.1 Introduction

The tragic events of September 11, 2001, changed the landscape and perception of global terrorism. Terrorist activity continues to be a major challenge for policymakers in both developed and developing countries. Africa has been increasingly recognized as a region warranting special counterterrorism attention (Abrahamsen 2004; Cilliers 2003). This attention is underscored by the fact that since the late 1980s, sub-state terrorist activity in countries such as Burundi, Democratic Republic of the Congo, Liberia, and Sudan have resulted in the loss of almost a million lives and significant destruction of physical property (Cilliers 2004). For example, between 1974 and 2008, a total of 4,993 terrorism incidents took place in sub-Saharan Africa, of which 261 groups claimed responsibility (Elu and Price 2012). To the extent that terrorism is fueled by apocalyptic and radical religious beliefs, Abrahamsen (2004), notes that British counterterrorism objectives in Africa recognize that there are more Muslims in Africa than there are in the Middle East—which may further increase the likelihood of radical Islamist terrorism (Elu 2012). The US Department of Home Land Security has responded to this challenge by implementing changes and tighter security to deal with domestic terrorism possibly catalyzed by radical Islam. However, international terrorism, and in particular African terrorism, continues to pose a challenge to counterterrorism policy.

The counterterrorism policy response of governments when addressing terrorism and its economic impact on national and international security often fail to consider how religion, ethnicity, colonial legacy, and rational choice explain, and interact to condition why some individuals and groups in Africa employ terrorist acts as an approach to justify their mission and objective. Terrorism is the systematic use of violence and terror against the state, government, and those in power. There are alternative definitions of terrorism and all emphasize use or threat of use of violence by individuals or sub-national groups to obtain political (p. 725) or social objectives through intimidation of a large audience beyond that of the immediate victims (Enders and Sandler 2006). In other words, terrorism is viewed as the use of terror and intimidation to gain political and social power and initiate change to achieve specific objectives. It seems a reasonable conjecture that for the median global citizen, terrorism is morally reprehensible, but for some it serves as a mechanism for change and a way to foster their political and economic agenda. Terrorism has become a bloody and robust venture around the world, which is not only a challenge for national and international policy makers, but also an issue for present and future national security.

Earlier analyses of the economics of terrorism have considered terrorism with respect to the weighted probability of success and failure. Using time series and ITERATE1 data, Enders and Sandler (2006) found that terrorist incidents such as bombings, assassinations, kidnappings, and skyjackings were reduced through intervention policies, that lower the benefit–cost ratio of terror, given the high probability of unsuccessful attempts after the implementation of such counterterrorism policies. Rational choice theory has also been applied to the airline industry using a continuous-time survival and logistic regression analysis model to determine the successful number of hijackings (Dugan, Lafree, and Piquero 2005). These studies also find that the frequency of aerial hijackings decline when the probabilities of success decreased. Other studies by Becker (1968), and Erhlich (2006), also show that the probability of apprehension, convictions, and long-term incarceration served as a deterrent for terrorist hijacking. Blomberg, Hess, and Weerapana (2002), also found that fluctuations in the business cycle affect terrorist activities and, in particular, high-income and democratic countries appear to have higher incidences of terrorism, and lower incidences of economic contractions. More recently, Brandt and Sandler (2009) found that terrorist kidnappings are sensitive to whether or not the host country of those being kidnapped make concessions or not. Arce and Sandler (2009) found that inequality appears to increase the cost of religious fundamentalism―one prerequisite for terrorism.

In spite of the various studies on the economics of terrorism and prevention strategies, terrorism as rational choice has not been exhausted in the literature and very little of it considers sub-Saharan Africa. The “Terrorism Knowledge Base” database indicates that the top ten terrorist groups in the world are located in Africa and South Asia.2 In recent years, both of these regions seem to be fertile breeding and cultivating grounds for terrorist groups that want to relocate. Indeed, a recent study reveals that most lethal effective perpetrators groups from 2009 to 2012 are based in Africa.3 For example, Boko Haram, which is based in Nigeria, has committed 80 percent of the terrorist acts in Nigeria (START Report 2013).

(p. 726) One can consider terrorism as an existential good―terror motivated purely on political, religious, colonial, and/or other-worldly grounds regardless of tangible costs and benefits, as an economic good that can be explained within a standard rational choice model of optimizing agents—with both perhaps having a genesis in a past historical event which persists through contemporary times. In this chapter, we consider the existing literature on the causes and consequences of terrorism in Africa. We consider what we deem the most relevant existing literature on terrorism and conflict so as to cast insight upon the problems and prospects that terrorism underscores for Africa. In general, research on the causes and consequences of terrorism in Africa currently constitutes a small portion of the economics literature, and it is our hope that this chapter will encourage more research, as constraining the growth of terrorism in Africa would plausibly be beneficial for economic growth. The remainder of the chapter is organized as follows. The first section that follows considers the causes of terrorism in Africa. In the second section, the consequences of terrorism in Africa are considered. The last section offers policy recommendations on how to combat terrorism in Africa.

39.2 Causes of Terrorism in Africa

Terrorism is not new in Africa; however countries such as Algeria, Burundi, Congo, Sudan, Ethiopia, Eritrea, Djibouti, Somalia, Kenya, Uganda, Tanzania, Nigeria, Rwanda, and others have seen an increase in terrorist acts in recent years. There are many explanations of why terrorist attacks occur and some attribute it to poor economic conditions, which is consistent with the popular theory of deprivation and poverty; low education attainment, and historical events such as slavery and ethnic conflicts have also been used to explain terrorism; however, there are studies that suggest otherwise. The magnitude or scale of destruction show that these acts are properly planned and they have devastating impact for victims with injuries (sometimes death), and promote physical asset destruction. The fact is that members of terrorist groups such as Hezbollah and Hamas are neither poor nor uneducated, so calculated attacks tend to have severe economic damage.

Viewed as a conflict resolution mechanism, terrorism can be broadly viewed as a strategy deployed by individuals, either singularly or in groups, to resolve disputes. The basis of such disputes could be based on distributional issues (e.g. of political power, income, wealth) or merely existential—based on religious conflict—or have a foundation in the historical past causing persistent conflict. Presumably, discriminating between these various sources can inform optimal counterterrorism policy, and if there is any value in a mode of inquiry dubbed “The Economics of Terrorism”, it should inform the causes and consequences of terrorism. To date, the literature has provided substantive insight, and in this chapter we consider it—not exhaustively by any means—and offer some insight as to how it can inform the causes/consequences of terrorism in Africa.

To the extent that terrorism is caused by distributional issues such as income inequality, the analyses of Krueger and Maleckova (2003) and Krueger (2007), for example, raise doubts about terrorism being caused by ignorance and poverty, as they find that terrorists are well-educated and typically not members of their society’s poor. On the other hand, Barros, Faria, and Gil-Alana (2008) found that poverty in Africa is associated with terrorism, and (p. 727) is mediated through condition of low political and economic freedom. As for ignorance, several analyses that appeal to rational choice models of terrorism suggest terrorists are quite rational. Two important notions or types of rationality are present-aim and self-interest.4 Individuals in terrorist groups are present-aim oriented if they are effective and efficient in the pursuit of whatever aims that happens to hold true at the moment of their action (Parfit 1984). Under this condition, no attempt is used to assess whether the aims (terrorist act) makes sense. For example, terrorist groups that prefer self-destructive behavior, the only requirement for making a decision to engage in terror is that they behave in the most efficient and effective destructive way. In contrast, individuals in terrorist groups are self-interested oriented if the choice of terror is conditioned on trade-offs engendered by cost, benefits, and resource constraints. Given self-interest orientation, the choice of terror must pass a tangible cost–benefit test, and under standard conditions there will exist demand and supply functions for terror that are a function of cost, benefits, and resources.

Religious organizations such as Hamas, Taliban, Hezbollah, Al-Shabaab, Al-Qeada, and other radical groups are potentially present-aim oriented as they use lethal suicide approaches as a terrorism strategy. Using the club model, Berman and Laitin (2008) found that radical religious groups are more lethal and choose suicide terrorism more often when they provide benign local public goods. The motives for these terrorist groups are altruism, fidelity to principle, and a desire for justice. The desire to destroy is paramount to their cause and action. In other words, utility maximization or satisfaction comes from massive destruction to justify their cause. However, Kruglanski and Fishman (2006) support the fact that terrorism is psychological in nature, and a given means will be utilized when the expected psychological utility is higher than that of other means, and the expected utility is determined by how well a given means is seen as contributing to the desired objectives. Some studies also show that the need for political freedom and stability can result in terrorism and massive destruction as a means to protest economic and political situations in countries where political instability exists. For example, Abadie (2004) showed that risk of terrorism is not significantly higher for poorer countries, and country-specific characteristics such as political freedom and countries with highly authoritarian regimes such as Iraq and Russia that are undergoing transition have a propensity to engage and sustain terrorist activities.

The benefit from terrorism under a present-aim orientation is purely non-monetary in nature, and these individuals exhibit bizarre behaviors and are contented to die for their cause in some cases. Africa and South Asia have long histories of breeding terrorist groups, and these groups have high-level of activities/incidents. Groups such as Al-Qaeda, Abu Nidal, Algeria’s Armed Islamic Group, the Lord’s Resistance Army, and the Communist Party of Nepal-Maoist are housed in Afghanistan, Iraq, Libya, Syria, Algeria, Sudan, Uganda, and India fall under this category. For these minority groups, rational behavior and utility maximization would probably be based on a present-aim standard, where non-monetary motives such as altruism, fidelity to principle, desire for justice, and political fairness for equalitarian purposes would be their motive. The analyses of Kruglanski (2003), Crenshaw (2000), and Combs (1997) suggest that terrorism is a social psychological phenomenon used by minority groups to influence economic, political, and social policies. There is a tendency for these (p. 728) groups to attract the powerless who seek recognition and feel that the dominant class has deprived them of what is rightfully theirs. The motivation for the minority group to become violent is based on relative deprivation theory where outcomes such as income experienced by individuals are inferior to those that they expect to receive or entitled to. Even though the theory of relative deprivation has been the dominate explanation of terrorism, Brush (1996) found that this theory may no longer be considered the primary cause of collective violence, although it may serve as a significant contributing factor under some social circumstances. Using a pooled regression and evidence from inverted U-shaped relationship, Davis (1999) and Crenshaw (2000) also found that there is positive relationship between increased repression and political and collective violence. The strategy for these groups is to choose a target that would inflect maximum harm or injuries on the majority group to demonstrate their power and existence. Their main targets are usually business-related areas with severe economic cost to the government and society. Using panel data, Greenbaum, Dugan, and LaFree (2006) found that terrorist attacks reduced the number of firms and employment in the year following an attack in Italy. The economic cost of terrorism is to deter new business formulation and expansions thereby increasing the unemployment rate in the area following terrorist attack.

The self-interest approach to terrorism on the other hand is based upon trade-offs associated with choices, when all choices are constrained by income/resources. If indeed terrorism is an optimizing choice, it can be conditioned on cost and benefits in a variety of ways. For example, terrorist activities may in some cases offer greater benefits for those with more education, and terrorist organizations (especially suicide bombers) would prefer to select those who have better education since a high level of education attainment is probably a signal of commitment, as well as the ability to carry out terrorist attack with more sophistication for higher income. Krueger and Maleckova (2003) found that there is a positive relationship between investment in human capital and suicide attacks. For example, a suicide bomber would need to be well educated and stable in order to assess and judge the trade-off and likelihood or probability of been caught or captured if poor judgment is exercised. Benmelech and Berrebi (2007) provided empirical evidence to support the theory that higher investment in human capital provides a larger marginal benefit to terrorist groups. Terrorist groups operating under self- interest are optimizing on cost/benefits, and the incentive to destroy is based on the maximum benefit that can be derived from the action considering investment in human capital.

Assume there are two types of terrorist groups with preferences defined over terror and non-terror, where for both types tastes for both terror and non-terror are exogenous. The first type is self-interested, and the second type is present-aim oriented. For the first type the indifference curves are negatively sloped, convex to the origin, and consistent in their preference ranking. This implies that terrorist groups are willing to tolerate a reduction in income in return for terrorist destruction. The indifference curves exhibit diminishing marginal utility (MRS), which indicates that the more resources the terrorist group has, the more they are willing to give up in order to obtain successful operation of the terrorist act. Self-interested terrorists will be willing to engage in an act when their payoff is high—indicating a higher opportunity cost. The marginal rate of substitution between terror and non-terror is positive (MRST, N> 0) and we assume that the income and substitution effects are such that demand curves for both terror and non-terror are always downward sloping.

(p. 729) For present-aim oriented terrorists, with U = f (T, N), the trade-off between T and N is non-existent or effectively zero (MRST, N = 0). Such a trade-off follows from the fact that as an alternative to the preferences assumed under self-interest, critical present aim theory as developed by Parfit (1984) and its modification by Savulescu (1998, 1999) makes three minimal claims about choices: (i) for a choice or act to be rational, the state of affairs promoted by that choice or act must be worth promoting. That is, it must promote some objectively valuable state such as wellbeing, achievement, knowledge, justice, and so on. (ii) The state of affairs promoted must have an expected value that is good enough relative to other available alternatives, and (iii) an individual is not rationally required to give up a concern for one objectively valuable state that is good enough for a relevantly different state which is more valuable.

If individuals in terrorist groups are present-aim oriented, choices are essentially “existential,” and are justified not on cost relative to benefit consideration, but more on principles, representing for example idealized political goals (Savulescu 1999). In this context, seemingly irrational choices such as suicide bombings have perhaps infinitesimal afterlife and empirical benefits relative to lost empirical lives, if the act is believed by the actor to have such properties. As such, the choice of terror, if present-aim oriented is not conditioned on tangible and/or observable costs and benefits that typically inform resource constraints in economic theory. The extent to which terrorist activity is an existential or economic good suggests that if terrorists are self-interested, their choices should be conditioned on costs, benefits, and resource constraints. On the other hand, if terrorists are present-aim oriented, terrorism is an existential good, and it is not conditioned on cost, benefits, or resource constraints.

As terrorism is a form of conflict, the extent to which particular historical events drive current conflicts could render history as a cause of terrorism in Africa. Civil wars and ethnic conflicts continue to torment the continent and killed more people than reported. Africa has seen more civil wars since 1960s. For example, the civil war in Nigerian (1967–1970), and the war in the Democratic Republic of Congo (1998–2004), violence and disease killed over 5 million people (Coghlan et al. 2006).5 Fenske and Kala (2014) found that in African regions that were most affected by the slave trade, conflict doubled in the years after the suppression of the slave trade in 1807. This suggests that historical events can induce conflict manifested as terrorism that persists into the future. As for particular mechanisms that would catalyze time-persistent terrorism, the results of Whatley and Gillezeau (2011) suggest that it could be ethnic fragmentation—which has been found to be a source of conflict (Esteban and Ray 2008)—caused by the Atlantic Slave Trade. Indeed if ethnic fragmentation is a source of mistrust across ethnicity, religion, and language, terrorism as a form of conflict resolution is likely to emerge in regions exposed to the slave trade, as Nunn and Wantchekon (2011) found that the intensity of the slave trade in the African past explains spatial and individual variation in the level of mistrust among Africans today.

Is terrorism in Africa existential, economic or historically dependent upon exposure to the slave trade? To get some descriptive empirical perspective on this, we consider a sample of 28 terrorist groups in Africa obtained from the Global Terrorism Database (GTD) that (p. 730) were active during 1980–2013. The GTD is an open-source database with information on terrorist events around the world since 1970 and includes systematic data on international as well as domestic terrorist incidents that have occurred during this time period, and now includes almost 80,000 cases. For each GTD incident, information is available on the date and location of the incident, the weapons used, and nature of the target, the number of casualties, and―when identifiable―the identity of the perpetrator. Table 39.1 reports for each African country, per capita gross national income (GNI), its Human Development Index (HDI) ranking, and the number of terrorists’ attacks between 1980 and 2013.

Table 39.1 Terrorism income and number of incidence in Africa


Per capita GNI (US$)

HDI ranking

Number of incidents (2012)

















Democratic Republic of Congo




Ivory Coast (Cote d’Ivoire)




























































Sierra Leone








South Africa




















Sources: Human Development Report, 2013 Global Terrorism Database at START 2013.

The Causes and Consequences of Terrorism in AfricaClick to view larger

Figure 39.1 Trend for countries with the most vital incidents.

Source: START Report, 2013.

The six countries with the highest terrorist attacks during this period in the region are Algeria, Burundi, Nigeria, Egypt, Somalia, and Congo. Dividing the terrorist groups into two segments, one representing the “low-end” groups who commit less than three incidents per year and the “high-end” groups that commit more than 10 incidents per year. In Africa, 18 groups were classified as low-end groups compared to other parts of developing countries. These groups committed three or fewer attacks, and are denoted by zero incidents, and therefore were excluded from (p. 731) the tests because they would not have an impact on the data. The “high-end groups,” with 10 or more incidents, were used to perform the regression analysis. The high-end groups comprised a larger number of incidents, injuries, and fatalities. The sample sets of the high-end groups were the top six groups with ten or more incidents and both regions had 10 high-end groups. Figure 39.1 depicts the trend of terrorism for select African countries.

The Causes and Consequences of Terrorism in AfricaClick to view larger

Figure 39.2 GNI per capita.

Despite the income per capita of US$7,418 (Figure. 39.2) which is high compared to other African countries, Algeria experienced the highest number of incidents from 1990 to 2011. This suggests a positive correlation between income and the number of terrorist incidents with the implication that terrorism, being income elastic, is a normal economic good. In general, the trend for Nigeria and Somalia is upward, underscoring perhaps the increasing radicalism of Islamic-based groups in these countries. Thus at least for the African countries considered in Table 39.1―which represent a group of countries in which the typical terrorist event took place in Africa―this suggests that the cause of terrorism appears to be existential, as the trend is dominated by the terrorist activities of radical Islamic groups in Nigeria and Somalia. As for the legacy of the slave trade, the countries in Table 39.1 also approximate the (p. 732) countries—particularly the six countries with the highest terrorist attacks during this period in the region—in the sample considered by Fenske and Kala (2014). This suggests that past exposure to the slave trade may indeed have some explanatory power for terrorism in Africa.

39.3 Consequences of Terrorism in Africa

Terrorism potentially has adverse impacts on economic growth, investment, and tourism. Terrorism incidents worldwide usually result in massive destruction with injuries and casualties. Most terrorist groups have the tendency to physically destroy productive assets as well as redirect resources away from productive uses. Studies have focused more on the direct economic cost such as expenditures on direct attack, to financial markets, defense/national security, and supply chain, which are calculated from direct approaches such as cost to property, productivity loss, and human (Barth, Li, McCarthy, Phumiwasana, and Yago 2006; OECD Report 2002). The indirect costs that are not usually measured include the emotional toll suffered by the victims, friends, relatives, other survivors, and the community at large. Businesses associated with the location of the event usually suffer setbacks. Using the “Terrorism Knowledge Base” with more than 20,000 terrorism incidents from various sources, researchers have made several empirical estimates based on cross-sectional and period fixed effects, and generally found that there is a negative correlation between terrorism and real gross domestic product (GDP)—the higher the number of terrorist incidents, the lower the GDP. In addition, GDP seems to be particularly sensitive in an adverse way to terrorist target type—particularly airports, transportation infrastructure, private citizens, and property (Barth, Li, and McCarthy 2006).

As a destructive activity that destroys property, and causes human casualties and fatalities, terrorism has obvious level economic impacts and consequences for countries in general. (p. 733) These measurable impacts include the loss of the productivity for those permanently injured and killed, the loss of productive capacity and for destroyed physical capita, reduction in GDP (Abadie and Gardeazabel 2008; Tavares 2003), and the loss of growth-inducing foreign direct investment (Powers and Choi 2012). Additional evidence for the adverse economic consequences of terrorism has been provided by Blomberg, Hess, and Orphanides (2004), who found that the incidence of terrorism is negatively and significantly related to GDP growth and foreign direct investment. African countries have experienced a high economic cost due to the activities of Ansaru and Boko Haram. These two groups have been linked to Al-Qaida in the Islamic Maghreb and have waged a brutal campaign against military, government, and civilian targets including Christians (START 2013). For developing countries such as Nigeria and Kenya, it makes the investment environment unfriendly as investors shy aware because of compromised safety and weak national security, which affects economic growth.

The potential threat to investors’ confidence in the economy can deter investment, as most investors are risk averse, posing a fear of not been able to remove their investment. The economic cost in Africa is far beyond the direct outlay, because terrorist incidents can deter future investment in affected countries, reduce foreign direct investment (FDI), and deter economic growth (START 2013). The importance of FDI as a source of growth in African economies renders these economies vulnerable to the adverse effects of terrorism as its persistence could constrain growth given terrorisms potential to constrain FDI. The increase in terrorism incidents in countries such as Kenya and Nigeria—two of Africa’s largest economies—could render them less attractive for FDI, causing both economies to shrink. Indeed, there is evidence to suggest that in the case of Boko Haram —a jihadist terrorist organization in Nigeria—the increase in the number of terrorist incidents attributed to them has contributed to FDI decline from US$8.28 billion in 2009 to US$6.1 billion in 2010, which constitutes 36 percent decline (Umejei 2011). For investors, national security is important too: they are likely to stay away from regions and countries where security is not guaranteed. For example, Boko Haram, located in the northern part of Nigeria, has the highest poverty rate in the country and has remained relatively unsafe as it is the region in Nigeria experiencing the highest number of terrorist incidents—making it difficult to attract FDI.6 Investment in counterterrorism efforts, while beneficial in constraining terrorism, can also be costly. It is conceivable that at least for some African countries, counterterrorism and security expenditures are too high. Developing countries such as Algeria, Burundi, Nigeria, Egypt, Somalia, and Congo, which rank high with respect to the number of terrorism incidents, have in recent history been spending on average about 30 percent of their GDP on efforts to combat terrorism and other threats to national security (OECD 2002). In general, it seems likely that terrorism has significant adverse economic consequences for Africa. However, as far as we can determine, the existing economics literature provides no explicit empirical insight into the direct consequences of terrorism in Africa.

As for indirect insight into the consequences of terrorism in Africa, the analysis of Elu and Price (2012) is of potential significance. They report evidence that remittances to sub-Saharan Africa are used at least in part to finance terrorism. Given that remittances otherwise finance (p. 734) productive investments in human and physical capital (Anyanwu and Erhijakpor 2010; Fayissa and Nsiah 2010), this suggests that terrorism in sub-Saharan Africa can possibly crowd out productive investments that are important for economic growth. To the extent that terrorist activity is correlated with or complements other types of growth-reducing conflict, the analyses of Berdal (2005), Collier, and Hoeffler (2004), Kaldor (2007), and Omeje (2007) suggest that the financing of terrorism in sub-Saharan Africa is also important for the promotion, severity, and duration of wars and civil conflicts—which are associated with lower growth in sub-Saharan Africa (Gyimah-Brempong and Corley 2005).

Last but not least, there is some evidence that terrorism in Africa may have some beneficial consequences. Wanta and Kalyango (2007) considered the impact of terrorism in Africa on media events in the USA, and the extent to which it can frame US foreign policy toward Africa. In general, a key finding was that terrorist events in Africa triggered media coverage that was associated with presidential policy initiatives leading to significant inflows of foreign aid in Africa. Thus, to the extent that foreign aid is beneficial for Africa (Juselius and Moller 2013), and its elasticity with respect to growth is larger than its elasticity with respect to terrorist events (e.g. some FDI is channeled into terrorism finance), terrorism is potentially beneficial for Africa, as it could lead to inflows of growth-inducing FDI.

A more stark possibility for terrorism to have a beneficial effect emerges from the recent analysis of Europe’s historical rise to economic prosperity by Voigtlander and Voth (2013). They found that the high frequency of depopulating wars in Europe prior to 1800 had the effect of increasing the ratio of land and capital relative to the population, which catalyzed increases in per capita income for war survivors that has persisted. Such a finding is hardly a policy prescription for economic growth in developing countries, as the findings of Voigtlander and Voth (2013) are an intellectual exercise in cliometrics, and are offered as an account and explanation of Europe’s rise in living standards. As for practicality, the weapons of modern warfare are far more destructive of both physical capital and individuals than in the past, and with the exception of poor countries, land–labor ratios are not significant determinants of per capita income. However, to the extent that terrorism takes hold and persists in poor African countries where land–labor ratios are important determinants of per capita income, if terrorism complements war, the destructive effects could be similar to that of Europe. If for example terrorism in poor African countries induces depopulation due to a mass exodus of individuals seeking safety elsewhere, the ratio of land and capital relative to population could increase. This would cause a rise in per capita incomes and living standards, possibly with persistence as in the case of Europe.

39.4 Conclusion

We have provided an overview on the causes and consequences of terrorism in Africa by considering the extent to which terrorism in these regions can be explained as rational optimizing behavior, as a political existential good, or as a legacy of history—in particular the effect of exposure to slave trading on contemporary conflict. The existing literature provides support for and against all these notions for countries in general, but actual and compelling evidence for Africa is sparse. As such, our examination is based mostly on what can be at least weakly inferred from the existing literate, both direct parameter estimates and indirect (p. 735) inferences and implications from descriptive data. Given the lack of attention to Africa in the existing literature on the economics of terrorism, more research on the causes and consequences of terrorism in Africa is clearly needed. Such research would inform the design of effective counterterrorism policy interventions, given that on average; the consequences of terrorism are likely to be adverse for Africa.

Notwithstanding the sparse literature on terrorism in Africa that would inform effective counterterrorism policy, some recent results regarding governance and regional integration in Africa are perhaps of policy significance. Elu and Price (2013) found that in West Africa, regional currency integration seems to increase the cost of terrorism, as countries sharing membership in currency unions have fewer terrorists relative to non-member countries. This suggests that regional economic integration in Africa is one policy intervention that can deliver not just higher living standards, but can also affect a reduction in terrorism. Elu and Price (2012) found that terrorists in Africa use remittances to finance terrorism. As remittances are also used to finance growth-inducing investments in physical and human capital, this suggests that terrorism can significantly crowd-out growth, and that stronger counterterrorism measures that monitor and scrutinize remittance inflows into Africa could be an effective way to combat terrorism.

Bodea and Elbadwi (2008) found that ethnic fractionalization has a negative and direct effect on growth and a positive effect on organized political violence with both effects ameliorated by the institutions specific to a non-factional democratic society. Li (2005) found that democratic participation reduces transnational terrorist incidents in a country, government constraints increase the number of those incidents, a proportional representation system experiences fewer transnational terrorist incidents than either the majoritarian or a mixed system. In Africa, where democratic institutions are weak and/or non-existent, such findings suggest that improved governance could potentially have large effects on terrorism. Moreover, strong institutions, enhanced democracy, good governance, and respect for the rule of law and can prevent and enhance the effective and efficient response before and after a terrorist incident. For example, it is estimated that after September 11, the USA spent over US$20 billion on direct costs, 21.8 billion on loss of property, which is about 0.2 percent of GDP, US$14 billion on private sector, US$0.7 billion from the Federal government, while the clean-up was US$11 billion (OECD 2002). This suggests that the development of non-factional inclusive democracy in Africa could reduce the frequency and level of conflict such as terror incidents. Last but not least, Bolaji (2010) makes convincing arguments―but provides no empirical evidence―that improvements in Africa’s governance capability/quality and security infrastructure would have an effective counterterrorism strategy. This seems a productive area for future research on terrorism in Africa―a consideration of how governance type (e.g. democratic, authoritarian), capacity/quality and security infrastructure condition the causes/consequences of terrorism.


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(1) ITERATE refers to the International Terrorism: Attributes of Terrorist Events. The ITERATE uses information from printed media to construct the chronology of transnational terrorist events.

(2) The top ten groups in South Asia are the Communist Party of Nepal, Taliban, Liberation Tigers of Tamil Eel am, Communist Party of India-Maoist, United Liberation Front of Assam, Al-Gama’al Islamiyaa, Al-Qaeda, National Liberation Front of Tripura, Hizbul-Mujahideen, and Purbo Banglar Communist Party.

(3) From 2009 to 2012: the most lethal perpetrator groups are Taliban, Tehrik-i-Taliban Pakistan (TTP), Boko Haram, Al-Qa’ida in Iraq, Communist Party of India-Maoist (CPI-Maoist), Islamic State of Iraq (IS), Al-Qa’ida in the Arabian Peninsula (AQAP), Al-Shabaab, Lord’s Resistance Army (LRA), and Revolutionary Armed Forces of Columbia (FARC).

(5) For an overview of how historical events such as conflict and war can condition current levels of economic development, see Nunn (2009).

(6) The Northern States are Burno, Bauchi, Taraba, Adamawa, Katsina, Kano, Kaduna, Jigawa, Plateau, Benue, Nasarawa, Niger, and Kwara.