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How to Deal with International Terrorism 1
How to Deal with International Terrorism
by
Tim Krieger* and Daniel Meierrieks†
Please cite as:
Krieger, T., and D. Meierrieks (2017). How to Deal with International Ter-
rorism. In: Eger, T., S. Oeter, and S. Voigt (Eds.): International Law and
the Rule of Law under Extreme Conditions. Mohr Siebeck, Tübingen, pp.
223-247.
Abstract
Since the 9/11 attacks on New York and Washington D.C., the fight against interna-
tional terrorism has been a dominant issue in the political arena. Policy-makers (still)
face the challenge to develop sound strategies for fighting this type of terrorist activity.
Unfortunately, there is no universal strategy to counter terrorism. This is partly due to
the diverse and clandestine nature of terrorist groups, and partly due to misperceptions,
lack of precise knowledge as well as divergent interests and prioritization on part of
policy-makers. The present chapter aims at providing a systematic overview on how
to deal with (international) terrorism, taking on a law and economics perspective. More
specifically, we will examine how the rule of law—both nationally and internationally
(i.e., in terms of the international law)—interacts with international terrorism and how
it can be sustained under the extreme conditions of terrorism.
* Wilfried Guth Endowed Chair of Constitutional Political Economy and Competition Pol-
icy, Department of Economics, University of Freiburg, and CESifo, Munich.
† Wilfried Guth Endowed Chair of Constitutional Political Economy and Competition Pol-
icy, Department of Economics, University of Freiburg.
2 Tim Krieger and Daniel Meierrieks
A. The Terrorist Challenge to the Rule of Law and to
International Law
Since the 9/11 attacks on New York and Washington D.C., the fight against
international terrorism has been a dominant issue in the political arena. The
direct and indirect costs of terrorism—ranging from the loss of human lives and
the destruction of assets to reduced economic growth and life satisfaction—are
substantial, making it necessary to develop sound strategies for fighting terror-
ism. The past decades, however, have shown that there is no universal strategy
to counter terrorism. This is partly due to the diverse and clandestine nature of
terrorist groups, and partly due to misperceptions, lack of precise knowledge as
well as divergent interests and prioritization on part of policy-makers. The pre-
sent chapter aims at providing a systematic overview on how to deal with (in-
ternational) terrorism, taking on a law and economics perspective. More spe-
cifically, we will examine how the rule of law—both nationally and
internationally (i.e., in terms of the international law)—interacts with interna-
tional terrorism and how it can be sustained under the extreme conditions of
terrorist activities.
A twofold challenge to democratic societies around the world arises from
international terrorism. The first challenge is to the national rule of law because
terrorism is an abnormal activity to which societies can only adapt with diffi-
culties. Making a society prepared or resilient to the potential threat of terrorism
may come at a rather high price with regard to other fundamental values in
society (such as civil rights). At the same time, countries being taken by a sur-
prise terrorist attack face the problem of responding swiftly without causing
economic and societal costs to skyrocket. The U.S. after 9/11 is a case in point.
The immediate legal response to the attacks, the Patriot Act, certainly interfered
with some of the most fundamental principles of the existing rule of law.1 Vio-
lations of the rule of law during extreme times might be acceptable only if cit-
izens are aware of this possibility ex ante. Simply legalizing this violation ex
post is likely to damage trust into the existing legal institutions, causing sub-
stantial societal costs in the long run.
In fact, from a law and economics perspective one needs to carefully evalu-
ate these three options—i.e., ex ante, during and ex post applications2—in
terms of their welfare-damaging consequences and choose the least costly one.
Ex-ante preparation (in legal terms) may result in unnecessary—when there
will never be a terrorist attack—restrictions of personal freedoms; legislative
1 See, e.g., Krieger (2013).
2 The distinction in ex ante, during and ex post applications of the rule of law under extreme
conditions follows Salzberger (2014).
How to Deal with International Terrorism 3
measures during an ongoing terrorist attack could lead to excessive and possi-
bly—under unfortunate circumstances—irrevocable changes of the legal
framework; ex-post legalization might undermine trust. One should be aware,
however, that there are other options beyond legal institutional change which
may help reducing the terrorist threat. We will return to this point below.
The second terrorist challenge results from its international dimension. In-
ternational, or transnational, terrorism involves at least two countries (e.g., be-
cause foreign targets are attacked or because a terrorist group crosses borders
to attack) and thus multiple legal frameworks at the national and (considering,
e.g., cross-border spillovers of conflict) international level. Several problems
may be related to such settings. For instance, national legal frameworks may
differ. This becomes most obvious when the well-known saying that “one
man’s terrorist is another man's freedom fighter” is considered. While the say-
ing is without much meaning since freedom is an end while terror is a means,
it points to the problem that the national legal perceptions of certain groups’
activities may not coincide. During the Cold War supporting terrorist groups
on the other side of the iron curtain was deemed acceptable in the West and
East. What is more, national legislation may induce terrorism spillovers to other
countries, where there are no generally accepted norms in international law
which help to avoid this problem. For instance, after 9/11 U.S. legislation led—
uncoordinated with U.S. allies’ counter-terrorism legislation—to substantially
increased security measures within the U.S. and for anyone who planned to
enter the United States. Arguably, this helped to avoid further terrorist events
on US soil, but might have led Al Qaeda to carry out further major attacks in
Spain (Madrid 2004) and the UK (London 2005). Taking again a law and eco-
nomics perspective, this calls for international coordination and ultimately for
norms in international law which help to internalize cross-border externalities.
This ought to improve global welfare.
Different from the first challenge, adapting international law to the threats
from international terrorist activities should mainly be thought of as a preven-
tive measure (although ex post adaptation appears to be the more frequent way
of developing international law3). Since arguably ex ante counter-terrorism pol-
icies—both within the legal framework and beyond—as well as extra-ordinary,
but later abandoned measures during a terrorist campaign also have clear ad-
vantages in terms of sustaining the (national) rule of law relative to most ex
post measures, we will resort to and focus on these measures in the following.
Doing so will also allow us to take a closer look at the root causes of interna-
tional terrorism. Only a deep understanding of these causes can guide policy
makers, including those in the legal arena, to choose appropriate counter-ter-
rorism measures.
3 See Salzberger (2014).
4 Tim Krieger and Daniel Meierrieks
B. Defining and Modeling International Terrorism:
The Rational-Choice Approach
Our previous reasoning has already pointed to the relevance of cost-benefit con-
siderations when evaluating policy measures against international terrorism.
More efficient counter-terrorism policies may produce economic and societal
costs, posing a difficult decision problem for society and their political and ad-
ministrative representatives. At the same time, however, there are policies and
legal frameworks which are more cost-effective than others, and taking a ra-
tional choice (or, arguably, a law and economics) perspective will help to iden-
tify them. Classical cost-benefit considerations ought to help legislators and
policy-makers to set the framework for appropriate counter-terrorism measures.
Following the widely used definition of terrorism by Enders, Sandler and
Gaibulloev, terrorism can be seen as the “premeditated use or threat to use vi-
olence by individuals or subnational groups against noncombatants in order to
obtain a political or social objective through the intimidation of a large audience
beyond that of the immediate victims.”4 Broadly speaking, terrorism is a short-
run tactic to achieve certain political or social goals in the long run which can-
not be achieved in the regular, i.e., non-violent, political process. Its (non-)ef-
fectiveness is an outcome of the terrorists’ strategic interaction with their ene-
mies, i.e., governments and security forces, as well as with the media which is
needed to transmit the message of fear and insecurity to the citizens whose re-
actions feed back to the initial strategic setting. Based on this reasoning, there
is no systematic difference between national and international terrorism except
that international terrorism involves perpetrators and targets/victims from or in
different countries.
One can easily infer that the above definition of terrorism is already based
on a rational-choice perspective on international terrorism. Strategic decision-
making to achieve specific goals most likely takes place only after weighing
off different alternatives. That is, the rational-choice perspective on interna-
tional terrorism assumes that terrorists—both as individuals and groups—behave
(perfectly) rational. Conceptually, individuals who follow their intentions are
assumed here to be—in principle—able to act to the best of her (relative) ad-
vantage.5 More specifically, it is assumed that each potential member of a ter-
rorist organization carefully weighs the costs of terrorism against its potential
benefits. As long as the marginal benefit of being (or becoming) a terrorist ex-
ceeds the corresponding marginal cost, an individual will resort to terrorism.
Similarly, if different modes of attack are available, the one with the highest
expected impact (benefit) at a given cost will be chosen.
4 Enders, Sandler and Gaibulloev (2011), 321.
5 This definition of rationality follows Kirchgässner (2008), 17.
How to Deal with International Terrorism 5
Nevertheless, one may wonder whether rationality is indeed associated with
terrorist behavior. The uneasiness with the rationality assumption arises mostly
from observing incidences of suicide terrorism. For most observers, weighing
one’s own death, which appears as an infinite cost, against some finite benefits
from achieving this-worldly goals through suicide terrorism can never lead to
this type of attack under the assumption of perfect rationality. Since suicide
attacks do occur, the rationality assumption appears to be wrong. Caplan ex-
plains this conundrum by the concept of „rational irrationality“.6 This concept
assumes that individuals may have irrational beliefs as part of their utility func-
tions (e.g., they believe in otherworldly rewards for martyrs), but decide strictly
rationally whether to live up to these beliefs. That is, they carefully weigh, on
the one hand, the psychological and/or social benefits of their (from most other
people’s perspective) irrational beliefs against, on the other hand, the respective
costs coming with their beliefs. In almost all cases, either the benefits are too
small or the costs are too high to become a terrorist or even a suicide bomber.
Or, as Caplan, puts it: “Suicide bombers are the outliers.”7
Does this, in turn, imply that those few who decide to become terrorists are
psychopaths? Certainly not. For one, terror groups are very careful in choosing
their active members. They need to be trustworthy and skilled in order to make
the best use of the groups’ limited resources. Mentally ill individuals may be a
danger to a group’s safety, such that we rather see them as “lone wolf” terrorists
(if at all). For another, careers in terrorism rarely start by becoming a terrorist
operative. More often, individuals are sympathizers initially and may then be-
come members with nonhazardous tasks (e.g. errands, armorers, technicians).
Since these jobs pay a living, some self-interest cannot be excluded. This is
even more true if the probability of becoming “promoted” to active or even
suicide terrorism is rather low (unless an individual really strives for becoming
a martyr). Obviously, this does not exclude the possibility that some terrorists
are indeed insane, but abnormal behavior is certainly not a precondition for
terrorist behavior.
At the same time, one should not disregard the role of organizational and
individual-psychological aspects of individual membership in terrorist organi-
zations, as McCormick points out.8 Terror cells may create their “own realities”
which seem to justify even morally wrong behavior. In fact, this may also relate
to the perception of legal rules, which for group members often appear as biased
toward the interests of their enemies. These “own realities” become even more
relevant when psychologically trained group leaders manipulate ordinary group
members, or when group members show particular psychological characteris-
tics (e.g., narcissism, identity disorders).9
6 Caplan (2006).
7 Caplan (2006), 92.
8 McCormick (2003).
9 Victoroff (2005).
6 Tim Krieger and Daniel Meierrieks
With these additions, characterizing terrorists’ behavior moves from a pure
rational-choice perspective toward a framework of bounded rationality, as we
typically assume in institutional economics. While individuals still strive for a
consistent and rational behavior, both internal and external constraints do not
allow them to achieve the same level of utility maximization as under perfect
rationality. Interestingly, when taking a closer look at terrorist groups, it ap-
pears as if boundedly rational behavior of single group members could be com-
pensated by the rest of group members.
In fact, terrorist groups are not only highly disciplined, but can also be char-
acterized by a high level of cost efficiency and a pronounced strategic behav-
ior.10 Especially group leaders are weighing the benefits against the (oppor-
tunity) costs of each attack for the group, thereby keeping the group’s long-run
goals (such as the redistribution of land, power, political influence or wealth)
in mind. What is more, they tend to respond in a predictable way to incentives,
which is in line with Kirchgässner’s definition of rationality.11
The central problem of terrorist groups is their relative weakness compared
to their enemies, i.e., the government, police, criminal prosecutors and military.
Hence, terrorist groups will resort to asymmetric warfare by very selectively
running attacks that reach the highest possible impact. Only this will guarantee
survival of the group and, arguably, success in the long run.
In a first step, the groups will try to draw the attention of the media to their
goals and, in this way, to destabilize the polity. Spectacular terrorist attacks are
the most promising way to attract media attention. This media attention is im-
portant because even large attacks hardly cause substantial direct monetary
costs to the enemy when compared to the overall economic power of a country
(say, the United States after 9/11). The much more relevant costs are indirect
costs resulting from the attack’s political, economic and psychological impact.
These costs increase with the extent of media coverage. As argued by Sunstein,
terrorists are well aware of how to maximize the indirect costs resulting from
terrorism and they choose their modes of attack and their targets accordingly.12
Terrorist attacks have a particularly strong impact if they surprise the target
audience and if they are highly frightening due to, e.g., their lethality. Although
these attacks are rare events and the probability of getting involved oneself is
negligible (if probabilities were calculated rationally) and although there is of-
ten a lack of past experiences (as a basis to calculate probabilities), people tend
to fear strongly that attacks of a similar type will soon happen again. This is
due to cognitive biases—especially the so-called probability neglect—which
10 See Sandler and Enders (2004) for empirical evidence.
11 Kirchgässner (2008). Note, however, that this indicator of rationality is arguably only a
weak one. Stricter indicators of rationality, such as a narrow self-interest and rational-expecta-
tions formation (see, e.g., Caplan 2006), may or may not apply.
12 Sunstein (2003).
How to Deal with International Terrorism 7
result in a systematic over-estimation of (terrorism attack) probabilities and as-
sociated individual risks.
The resulting fear makes individuals demand (immediate) protection from
their domestic governments. This brings us back to our initial remarks on the
distinction between ex ante, during and ex post applications of the rule of law
under extreme conditions. Obviously, the existing rule of law—whether or not
already adapted to work against the terrorist threat—did not deter this specific
attack (but possibly other ones). However, under an ex ante adaptation the rule
of law under extreme conditions can immediately be applied. Citizens are typ-
ically aware of the fact that a special legislation will come into effect allowing,
for instance, for additional security measures, specific criminal law instruments
against terrorists and (extra-legal) activities of intelligence. This way, citizens’
demand for protection can be fulfilled. What is more, if the (temporary) legal
framework in this extreme situation is well designed there will be less need for
additional ad hoc legislation.
The latter kind of legislation becomes much more relevant if no ex ante precau-
tions were taken. Under the conditions of probability neglect, any public de-
mand for protection will, on the one hand, be exaggerated and, on the other
hand, be met quickly by democratic governments who strive for re-election and
who—seemingly—offer any desired level of protection which promises win-
ning the next elections.13 Many of the implemented measures only improve the
sense of security (e.g. through additional police on the streets and stricter airport
security checks), but hardly have a lasting effect in fighting terrorism as they
do not solve its root causes. Even worse, several ad hoc policies include re-
stricting fundamental civil rights which, however, appears acceptable or desir-
able to the frightened and traumatized citizens.14 Given the objectively low risk
of further terrorist attacks (at least in Western countries), these restrictions are
certainly exaggerated. They tend to result in increased transaction costs and are
thus welfare decreasing.15 Hence, the political and economic system will be
destabilized and thus make it easier for terror groups to pursue and achieve their
goals. This is because ceteris paribus the government‘s (opportunity) costs of
fighting terrorism increase.
Figure 1 shows the correlation between international terrorist attacks and
the strength of the rule of law for 171 countries, where two important remarks
are in order. First and in line with the previous discussion, it is far from clear in
which direction causality runs. On the one hand, a strong (ex ante) rule of law
may deter terrorism because it may, e.g., strengthen domestic institutions and
thus resilience.16 On the other hand, terrorist attacks tend to shape (during and
13 Arguably, this strategy may be futile. For instance, Gassebner, Jong-A-Pin and Mierau
(2008) show that re-election chances after a terrorist attack are low.
14 See Krieger (2013) for a discussion of this aspect in the context of 9/11.
15 See Krieger and Meierrieks (2009) for a summary of the empirical evidence.
16 See Choi (2010) for empirical evidence.
8 Tim Krieger and Daniel Meierrieks
Figure 1: The correlation between international terrorist attacks and the rule of law
ex post) the rule of law. Second, the seemingly clear and significant negative
correlation between the variables under consideration disappears (i.e., becomes
insignificant) once the five notorious outliers (Afghanistan, Iraq, Nigeria,
Pakistan, Somalia) are skipped. We may conclude from this that the role of the
rule of law should not be overemphasized in the fight against (international)
terrorism.
Finally turning to the cost-benefit considerations of terrorist groups, terrorist
activities are constrained by the direct costs of the attacks which are, however,
usually relatively low.17 Another constraint is group size. Group success may
either result from sheer group size or from a group’s secrecy which allows them
to more effectively surprise the audience. The psychological effect is particu-
larly high in the latter case. What is more, large terror groups are more prone
to be infiltrated by national intelligence; alternatively, increasing popularity and
membership would allow a terror group to change its strategy and to become a
civil war party which openly attacks its enemies.18 In any case, the decision-
making under these circumstances can be explained consistently within the ra-
tional-choice framework and can be observed in the real world.
The support of terrorist groups in both financial and personnel terms depends
on the political, institutional (including legal) and economic conditions in a
17 Most Al Qaeda attacks were estimated to have cost some ten thousand dollars; only 9/11
is beyond this scope with a cost of approximately 500,000 dollars, but its impact is exception-
ally high. See Krieger and Meierrieks (2013).
18 See Brück, Schneider and Meierrieks (2014) for a discussion of the possible evolution of
terrorist groups.
-3,00
-2,00
-1,00
0,00
1,00
2,00
3,00
010 20 30 40 50
Rule of Law (2007)
Number of International Attacks (2007)
How to Deal with International Terrorism 9
country (or with respect to what has been brought into a country from an exter-
nal enemy, e.g., in terms of perceived Western cultural imperialism). If the con-
ditions are perceived as positive, people’s support of terrorist activities will ce-
teris paribus be lower because the (opportunity) costs of terrorism increase.19
This relationship can be seen in Figure 2 which presents a stylized framework
of how different aggregate country-specific factors affect terrorist behavior ac-
cording to rational-choice theory (as an economist would interpret it).
The central assumption of this theoretical framework is that perfectly ration-
ally behaving terrorists and—in the aggregate—groups will act according to
their cost-benefit matrix as well as other exogenous constraints. Expected util-
ity will be maximized when marginal costs (resulting from the necessary re-
sources and the opportunity costs) are equal to the marginal benefits of terror-
ism (resulting from achieving the group’s tactical and strategic goals). External
political, economic and institutional factors affect the cost-benefit matrix
through changes of the relative price of terrorism. For instance, a strong rule of
law (e.g., a strong national emphasis on civil and human rights protection) in a
country may restrict the spectrum of potential counter-terrorism measures (e.g.,
using torture to extract information from captured terrorists). Ultimately, the
relative price determines the decision whether or not to become active as well
as the scope of activities.
According to Krieger and Meierrieks,20 the external factors include socio-
economic deprivation of individuals and groups (e.g., poverty); modernization
strain (e.g., unemployment due to structural change; or large and well-educated
young cohorts desperately searching for jobs); the institutional order (e.g., cor-
ruption; a legal system which is perceived as unjust; or the lack of a social net);
political transformation (e.g., civil war); identity conflicts (e.g., minority dis-
crimination; or discrimination along language lines); the global order (e.g.,
dominance of the U.S.); and finally spatial and temporal contagion (important
predictors of terrorism because terrorism spreads to neighboring countries and
past terrorism is a good indicator for future terrorism).
Empirically, it can be observed that the most relevant factors explaining the
genesis of international terrorism are either politico-institutional or socio-de-
mographic ones.21 Economic factors, although often mentioned in public de-
bates, play only a minor role. That is, factors such as poverty or inequality do
not necessarily cause terrorism if they occur in a country which is characterized
by legal and non-violent means to voice protest, by political participation, a
strong rule of law and high social mobility, all of which help to reduce frustra-
tions from economic grievances.
19 See Krieger and Meierrieks (2011).
20 Krieger and Meierrieks (2011).
21 Krieger and Meierrieks (2009, 2011); Gassebner and Luechinger (2011).
10 Tim Krieger and Daniel Meierrieks
Figure 2: How country-specific factors affect terrorist activity
C. Implications of the Rational-Choice Model
for Counter-Terrorism Policies
The rational-choice framework can be used to categorize counter-terrorism
measures. Here, the decisive point is how the relative price of terrorism can be
driven up most successfully and, arguably, at a reasonable cost for societies
which suffer from terrorism or which fear the possibility of a terrorist attack.
Again, we consider an “ex ante” or “during” perspective in Salzberger’s termi-
nology.22 Some of the following policy measures are effective mostly in deter-
ring potential recruits for becoming active terrorists, others are also useful dur-
ing a terrorist campaign by hindering terrorists to successfully hit their
preferred targets and to thus achieve their goals. As seen before, the rule of law
under extreme conditions is an institutional factor possibly affecting the price
of terrorism to the better or worse.
As discussed before, citizens demand an immediate reaction of the govern-
ment after a terrorist attack. In this situation, governments tend to respond with
22 Salzberger (2014).
How to Deal with International Terrorism 11
traditional counter-terrorism policies which try to reduce the (perceived or real)
terrorist threat by increasing the direct costs of terrorism. The necessary instru-
ments for doing this may have been implemented ex ante or they may be set ad
hoc by the legislator (in the latter case, the danger of over-reaction is greater).
For instance, governments may increase security controls at prominent loca-
tions which could make targets for terrorists. Often, legal or extra-legal intelli-
gence measures will be employed, too. The major benefit of this strategy is that
it may indeed interrupt the planning and execution of future terrorist attacks.
This eases the situation and is therefore in the immediate interest of politicians,
the public and security forces.
There are, however, also important problems with this approach. For one, it
does not remove the root causes of terrorism. Oppressing terrorist activities will
increase the pressure under the surface, possibly causing an eruption of violence
at some later point in time. That is, although strongly believed by many, an
oppressive approach is most likely not a sustainable strategy against terrorism
in the long run. For another, in their effort to come up quickly with promising
counter-terrorism measures legislators are often lax with respect to civil and
human rights or the international law. Since citizens accept restrictions of their
rights in extreme situations such as in the aftermath of terrorist attacks, security
forces and (military) intelligence use the window of opportunity to push
through far-reaching regulations which often go beyond the issue at stake.23
The legal and institutional changes may turn out to be irrevocable, such that
political, economic and social costs will continue to be high even in the very
long run.24
Next to fighting terrorists directly through traditional counter-terrorism pol-
icies, an alternative strategy could be to interrupt the genesis of terrorism by
making terrorism an unattractive option for potential dissidents. The rational-
choice theory suggests two different approaches to achieve this goal: raising
terrorism’s opportunity costs or reducing its benefits.
Increasing opportunity costs may result in increasing difficulties of terrorist
groups to recruit new members. If socio-economic grievances are low, if socio-
demographic strain is negligible and/or if politico-institutional conditions are
favorable, the interest in terrorism and the willingness to give up one’s “nor-
mal” life and becoming a terrorist is typically low. For instance, Krieger and
Meierrieks show that social policies help to dampen terrorist activities when
they are connected to the socio-economic environment of ‘‘typical’’ terrorists
and their supporters.25 This can be achieved best by resorting to social policies
like health care spending and labor market mobilization which are perceived as
23 See Krieger and Meierrieks (2013) for the example of anti-money laundering regulations
after 9/11.
24 See Krieger (2013).
25 Krieger and Meierrieks (2010).
12 Tim Krieger and Daniel Meierrieks
offering better perspectives for potential terrorists for the future. Hence, coun-
ter-terrorism policies may focus on improving those socio-demographic and
politico-institutional factors that have been shown to be particularly influential
to the genesis of terrorism. One caveat should, however, be noted: focusing on
one factor alone may not suffice as it is often a whole set of factor whose com-
bination is responsible for terrorism.26
At least from a theoretical perspective, one may as well try to lower the ex-
pected benefits from terrorism. Here, it is possible to make it more difficult to
achieve terrorists’ tactical (or short-run) goals, e.g., by making the political and
economic system more resilient (then, destabilizing the polity and the economy
is no longer easily possible). Another promising strategy is to undermine the
terrorists' belief system, so that, e.g., religious authorities express their doubts
about, say, otherworldly rewards for martyrs who kill innocent victims on a
suicide mission.
In Table 1, we summarize these ideas by providing a taxonomy of counter-
measures along the three dimensions outlined above. Within the rational-choice
framework (as outlined in the Table), there is a tendency to view terrorists as
responding—more or less—passively to the presented counter-terrorism
measures. Brück et al., however, argue that it would be misleading to consider
terrorism and its appropriate counter-measures as a static process.27 As stated
above, terrorism is to some degree a strategic process in which terrorists, their
enemies and other groups (the media, the voters) interact. That is, any counter-
terrorism measures can—at least in the short run— result in a strategic response
of the attackers. Policy-makers need to keep this in their minds when designing
counter-terrorism measures.
For instance, some counter-terrorism measures may result in innovation
and/or substitution on the side of the terrorists. That is, terrorists may use more
powerful weapons during their next attack (innovation) or they may resort to
new attack modes or new targets (substitution). An attack may also be a prov-
ocation with which the terrorists hope to be able to enter an escalation process
which might help them to recruit more followers. According to Brück et al. this
may also result in vigilantism.28 Not even offering concessions may be a solu-
tion to this situation as terrorists may spoil the peace in order to start yet another
round of escalation. This will especially be true if terrorist groups get the im-
pression that it will be possible to extract even more far-reaching concessions
from a weak government (e.g., independence instead of “only” autonomy). Fi-
nally, an organizational evolution of terrorist groups—to the better or the
worse—may occur. They may end up as political parties in a democratic sys-
tem, but also as war parties in a civil war or they might move from terrorism
26 See Brockhoff, Krieger and Meierrieks (forthcoming).
27 Brück, Schneider and Meierrieks (forthcoming).
28 Brück, Schneider and Meierrieks (forthcoming).
How to Deal with International Terrorism 13
Direct Costs
Opportunity costs
Benefits
Raising material costs
e.g., costs of weapons and
explosives by making ac-
cess to them more difficult
Raising transaction costs
e.g., restricting the ease of
movement through immi-
gration control; limiting the
availability of financial re-
sources through measures
against terrorist financing
Raising (direct) costs of liv-
ing as a terrorist
e.g., probability of detection
(police, intelligence etc); se-
verity of penalties (intro-
ducing harsher punishment
for terrorism-related crimes)
Reducing socio-economic
grievances
e.g., using foreign aid to
lower poverty, inequality,
poor growth or unemploy-
ment in terror-exporting
countries
Improving politico-institu-
tional conditions
e.g., providing political and
legal assistance to
strengthen political rights,
civil liberties, the rule of
law, property rights protec-
tion and political stability
Improving socio-demo-
graphic conditions
e.g., providing assistance to
reduce (the impact of) youth
burdens (including youth
unemployment)
Changing the global order
e.g., using diplomacy and
the international to help ter-
ror-exporting countries to
adapt to globalization pro-
cesses and to reduce related
grievances
Making it more difficult to
achieve tactical goals
e.g., increasing the immedi-
ate resilience to attacks or
diffusing media attention
Making it more difficult to
achieve strategic goals
e.g., strengthening the long-
run political, societal and
economic resilience to ter-
rorist campaigns; undermin-
ing the terrorists’ belief sys-
tems; reducing support from
source countries’ societies
by making concessions to
them
Table 1: A taxonomy of counter-terrorism measures
toward ordinary criminal gangs, especially if they have gained territorial con-
trol.
D. International Policy Coordination
While the rational-choice framework is very helpful in highlighting policy op-
tions, it lacks specific consideration of the international dimension to the fight
against terrorism. As we have argued above, international or transnational ter-
rorism involves, by definition, more than one country, implying the need for
international coordination through an appropriate international legal frame-
work. If the international law fails to internalize terrorism and counter-terrorism
14 Tim Krieger and Daniel Meierrieks
spillovers between countries, global welfare might not be maximized. How-
ever, international coordination is a difficult task because the international com-
munity might run into a prisoner’s dilemma.29
Let us elaborate further on our second terrorist challenge from section A and
consider, for a moment, a unilateral counter-terrorism measure. According to
Lee, two effects will then be possible.30 For one, fighting an internationally-
oriented terrorist group with traditional domestic counter-terrorism measures
may drive the group out of the own country and into a neighboring country (if
the group can achieve their goals there as well). That is, a terrorist group will—
perfectly rationally—search for the weakest link on the international counter-
terrorism map.31 It will, for instance, choose a country with a particularly weak
rule of law. This resembles a classical externality problem in which the (social)
costs of unilateral policy measures are too high globally because the active
country does not internalize the (negative) external effects on its neighbors.
International policy coordination, such as setting the same legal standards
and conducting analogous counter-terrorism measures everywhere, might help
resolving this problem. This may, however, come at a price when noninvolved
countries come under international pressure and will be compelled to sign in-
ternational agreements violating their actual national interests and preferences,
at least those that would prevail without terrorism diverted from another coun-
try. What is more, there is also a distributional dimension to changes in inter-
national law. The country that was initially targeted by the terrorists will be able
to shift some of the costs of counter-terrorism measures to noninvolved coun-
tries. For instance, terrorism could be anti-American in the first place but the
response to it is international in the sense that many countries have to tighten
surveillance just to secure the status quo of living in a terrorism-free environ-
ment.
For another, not always will domestic counter-terrorism measures have this
problematic negative effect. In fact, they could also work in the opposite direc-
tion by weakening a terrorist group so much that it will no longer be a threat
both at home and abroad. The elimination of Al Qaeda leaders by the U.S. mil-
itary might be an example for such a scenario. In this case, one country’s activ-
ities cause a positive externality on its neighbors. Following again the classical
externality argument, we would expect a too low (unilateral) level of counter-
terrorism measures from a global perspective. Not only does the active country
(say, the U.S.) provide too little effort in this respective, other countries may
try to free-ride on the active countries’ measures by providing hardly any ac-
tivities themselves. This calls again for international policy coordination with
all targeted or potentially targeted countries agreeing on how to share the costs
29 See Brück, Schneider and Meierrieks (forthcoming).
30 See Lee (1988).
31 See Sandler and Enders (2004).
How to Deal with International Terrorism 15
of counter-terrorism measures. However, it is difficult to come up with an ef-
fective coordination in cases of terrorism. First, countries do not like to give up
national sovereignty or at least share information in the sensitive field of na-
tional security (this is especially true for the U.S. as the NSA affair has recently
shown). Second, supporting weakest link countries implies that the relative se-
curity of the supporting country decreases, which is hardly in the interest of this
country.
Hence, using more traditional cost-raising counter-terrorism policies unilat-
erally against the threat of international terrorism may be counter-productive
without international policy coordination through the international law. How-
ever, whenever cross-border externalities matter, coordination failure through
a prisoner’s dilemma is a likely outcome. Typically, there will be strong incen-
tives for countries not to coordinate. With negative externalities, unilaterally
diverting terrorism into other countries improves security at home and is thus a
reasonable strategy. At the same time, not improving security while other coun-
tries do would result in an influx of terrorist activity. Regardless of other coun-
tries counter-terrorism policies, improving homeland security is the dominant
strategy for any country. However, there is no upper limit to this strategy and
an international “arms race” may result which often tend to involve too many
restrictions of civil rights. With positive externalities, free-riding on other coun-
tries counter-terrorism is a likely dominant strategy resulting in sub-optimally
low protection against the threat of international terrorism. The international
law is always an outcome of these problematic incentives and is therefore likely
to be non-optimal in terms of global welfare.
Interestingly, this unsatisfactory picture does not change when policies are
pursued which tackle the opportunity costs or benefits of terrorism (the two
other policy options the rational-choice framework offers; see section C).
Fighting terrorism by changing socio-demographic and politico-institutional
conditions often takes a long time. For instance, enhancing trust into domestic
institutions, such as the legal system, by improving the rule of law may require
decades. In addition, these improvements also tend to be very costly. Terrorism-
producing countries often need external advice and financial aid to change these
very conditions. Providing support unilaterally, e.g., by giving foreign aid,
means that the supporting country produces a public good for the international
community resulting in a decrease of terrorist activities everywhere. This leads
again to a prisoner’s dilemma situation because it is the dominant strategy for
each country to abstain from giving foreign aid. In an attempt to free-ride on
other countries’ expenses governments wait for other countries with a high self-
interest in fighting terrorism to give aid. Again, under the existing international
law which is shaped by these very incentives we will typically not see a satis-
factory solution in international negotiations. That is, there is no sufficiently
16 Tim Krieger and Daniel Meierrieks
strong institution to enforce participation of independent nations in joint sup-
port programs and terrorism cannot successfully be tackled this way.32
E. Learning from 9/11: An Evaluation of Cost-Raising
Counter-Terrorism Policies
Our previous discussion has highlighted potential measures for fighting in-
ternational terrorism. From a theoretical perspective, there exists a wide range
of those measures; however, not all of these measures have been shown to be
particularly successful in the past. In this context, the 9/11 attacks provide an
interesting case study as in its aftermath the broadest possible set of cost-raising
counter-terrorism policies has been applied (the number of opportunity cost-
raising and benefit-lowering policies has been much lower and will be briefly
discussed in Section F). The immediate reaction of the American citizens to the
shock of the 9/11 attacks was to demand quick and sufficient protection to in-
hibit further attacks of a similar type. These introduced measures ranged from
passive measures of protection to active (military) measures of going against
the perpetrators in their base countries (e.g., Afghanistan).
In the following, we will take a closer look at 9/11 and investigate which of
the counter-terrorism measures, which were introduced at that time, were suc-
cessful and which ones were not. In terms of Salzberger’s distinction of ex ante,
during and ex post applications of the rule of law under extreme conditions, it
is noteworthy to say that the U.S. was clearly not prepared—ex ante—to a terror-
ist attack of this extent, neither as a society in general, nor—more specifically—
with respect to the existing rule of law. Despite terrorist incidents against the
U.S. in the 1990s,33 Congress was rather reluctant to grant additional rights to
security forces at the expense of civil rights. Most counter-measures were in-
troduced within days or weeks after the attack and hence qualify as “during”
applications (with some ex post justification). Since, however, hardly any of
the measures introduced in the Patriot Act and other legislation has been re-
voked yet (and since it appears unlikely that this will happen anytime in the
foreseeable future), they build the set of legal rules for the U.S. response for
any future terrorist attack against this country (in this sense, they are “ex ante”).
32 This argument implicitly assumes that governments’ strategic behavior is short-sighted.
In more complex (repeated-game) settings, e.g. assuming that every country will sooner or later
fall victim of terrorism, countries may agree to cooperate despite short-run incentives speak
against cooperation. Certainly, however, this does not contribute to speeding up the interna-
tional negotiation process.
33 For instance, the World Trade Center bombing of 1993; the bombing of U.S. embassies
in Kenya and Tanzania in 1998; the attack on the USS Cole in the port of Aden, Yemen, in
2000.
How to Deal with International Terrorism 17
The question open to debate is whether this set of rules is appropriate to deal
with the terrorist threat.
The most obvious and immediate response to attacks by international terror-
ist is to secure the “homeland”, in this case the U.S. Assuming that terrorists
indeed plan further attacks, protection measures (such as improved security
checks at the airport, fortification of landmark buildings, surveillance cameras)
will increase the costs of running a terrorist attack and should—according to
the rational-choice framework—make attacks less likely. At the same time,
these measures may make the entire country more resilient to terror attacks and
thus reduce the terrorists’ benefits from achieving their short-run goals.
Measures like these have distinct advantages and disadvantages. Among the
advantages is the fact that they can swiftly be introduced, as already pointed
out in Section A. This is possible because it is not necessary to go through a
time-consuming legislative process34 as most of these measures can be enacted
at the administrative level (i.e., here the necessary legislation existed already
ex ante). As a result, the measures help to increase the feeling of security in the
population at once, which is an important aspect of resilience. A frightened or
even terrified population has to be interpreted as a success for the attackers,
while resuming the normal order within days is a clear signal to terrorists that
the attack’s pay-off was low and that the terrorists were not able to achieve their
goals as desired.35 That is, within a strategic game between terrorists, the gov-
ernment and the population any measure that strengthens (short-run) resilience
shifts the equilibrium in favor of the victims.
The latter point may, however, also give rise to a more pessimistic interpre-
tation. Given that terror groups are typically much smaller than their “enemies”,
their perceived danger comes from the surprise moment of their attacks which
makes it extremely hard to predict the next targets. This implies, in turn, that
protection measures need to be extended to a wide number of potential targets,
thereby raising the associated costs of this strategy enormously. Yet, there is no
guarantee at all that the next target will be a protected one. In a strategic setting,
the terror group is the second-mover only after the government has determined
its protection measures before. Hence, the above mentioned strategies of sub-
stitution and innovation are most often an optimal response of the terror groups
to observable protection measures by the government. At the same time, they
tend to cause substantial direct and indirect (transaction) costs to governments,
private business and the public.
34 A more pessimistic view on the aspect of saving time on these issues is that the legislative
process may be rather sloppy.
35 The consequences of 9/11 were mixed in this respect. While the events are traumatic until
today and their repercussions in society are still enormous, e.g., the New York Stock Exchange
already reopened on September 17.
18 Tim Krieger and Daniel Meierrieks
Governments should therefore concentrate on using protection measures
only on (truly) critical infrastructures. Only this will keep the cost-benefit bal-
ance intact. In case of landmark monuments which have mainly cultural (but
little practical) value a credible commitment to rebuild might be a cheap alter-
native, as it will make it less attractive to attack this monument.36
Another major downside to immediate responses aiming at securing the
homeland is—as already pointed out above—the problem that governments
tend to fall victim to an action bias as a result of the public’s strong demand for
protection and the resulting chance to obtain credit for responding to the risk.37
This reaction was clearly observable in the aftermath of the 9/11 terrorist at-
tacks.38 Hence, a sub-optimally high level of protection—relative to the ex-
pected gain from avoiding another (rather unlikely) attack—can hardly be
avoided.
Protecting the homeland from international terrorists turns out to be difficult,
however, if the attackers already reside in and start their attack from this coun-
try. The 9/11 perpetrators entered the U.S. weeks or months before the attack,
thereby passing the strict U.S. immigration procedures as unsuspicious tourists
or students. Later they made use of the low security standards for domestic
flights at U.S. airports to start their attack. One of the consequences of 9/11 was
therefore to increase efforts to keep foreign attackers and support for them out
of the country. While not possible in case of extraterritorial entities (such as
embassies on foreign ground) and citizens who live or travel abroad, interna-
tional terrorism may indeed be restricted by hindering foreigners with danger-
ous intentions to enter the country.
Compared to the previously mentioned protection measures, the implemen-
tation of such measures is more difficult from both a practical and legal per-
spective. Restricting entry of foreigners to a country is—without doubt—a pre-
rogative of any nation state, so the domestic legislative may change
immigration laws accordingly. As with any immigration law the free mobility
of free citizens will be restricted, which may be criticized in general. However,
there is an additional dimension to this problem in case of terrorism because
justification of the restriction of immigration is more intricate. Not granting
access to a country follows from a speculation (or, arguably, an educated guess)
about the disposition of the potential traveler or immigrant. Although disposi-
tions or intentions cannot be elicited from a person, it is clear that with very
few exceptions the rejected immigrant is not a terrorist and does not plan to
become a terrorist (see Caplan’s argument above). Accordingly, this policy may
be seen as a violation of fundamental personality rights, especially when there
is an ethnic bias in (not) granting entry.
36 See Frey and Rohner (2007).
37 See Patt and Zeckhauser (2000) and Sunstein and Zeckhauser (2008).
38 See the discussion of the costs of 9/11 in Krieger (2013).
How to Deal with International Terrorism 19
From a more practical perspective, tightening immigration legislation may
have severe negative economic repercussions. For instance, after the 9/11 at-
tacks studying in the US became increasingly more difficult for prospective
foreign students in general and for those from Muslim countries in particular.
The number of incoming students and of foreign guest researchers declined
substantially in the first years after 9/11, thereby undermining the country’s
competitiveness in the long-run.39
There is another aspect to be kept in mind. Closing the borders may cause
negative externalities on other countries, which implies that border regimes
tend to be too strict. Consider the following scenario which is related to the
above discussed idea of substitution. A terrorist group aiming at targeting, say,
the U.S. will no longer be able to send members to the U.S. because of a stricter
immigration regime. In order to nevertheless harm the US, they will resort to
bombing a U.S. embassy or military base in another country, possibly leading
to casualties and disastrous political, societal or economic consequences in this
country. Most likely, the U.S. as a very resilient country (in political, societal
and economic terms) would have been able much better to cope with the attack,
keeping costs to society rather low. Hence, we observe two problems. For one,
there is the negative externality causing harm to a country which was actually
not involved in the conflict between the terrorists and the U.S. government. For
another, if an attack is unavoidable, it would be better from a (global) social
planner’s perspective to have it in the more resilient of the two countries, i.e.,
in the U.S. In any case, a unilateral border regime is sub-optimal, speaking to
the idea of improving international coordination.
One can extend the above reasoning to the case of reducing terrorist activi-
ties by drying out their financial resources. Financial support may come from
very different sources including state and private sponsors as well as criminal
activities by the groups themselves. According to Brück et al., counter-terror-
ism efforts may try to denounce state sponsorship of terrorism (e.g., through
actions by the United Nations), reduce the international money flows from ter-
rorist supporters to terrorist groups and make it more difficult for terrorist
groups to launder money coming from criminal activities via anti-money-laun-
dering initiatives40 However, none of these measures is easy to introduce into
the international law and promises lasting success in reducing terrorist activity.
For instance, until today it is not possible to effectively control parallel banking
systems such as the Hawala system.
What is more, political and economic interests differ between countries as
do legal systems and traditions. For instance, banking secrecy plays a very dif-
ferent role in countries around the world. International law depends strongly on
the willingness of countries to get involved in international negotiations and
39 See Haupt, Krieger and Lange (forthcoming).
40 Brück, Schneider and Meierrieks (forthcoming). For a specific discussion of anti-money
laundering initiatives, see Krieger and Meierrieks (2013)
20 Tim Krieger and Daniel Meierrieks
eventually follow the newly introduced international rules. This problem is par-
ticularly relevant due to the existence of “financial safe havens”.41
Again, the problem of discovering the true intentions of a person who gives
or transfers money is highly relevant. Terrorist financing has been called
“money laundering in reverse” for good reasons.42 While proceeds from crim-
inal activities need to be washed clean, money given to terrorist groups most
often comes from legal sources and only its use is criminal. Mixing up anti-
money laundering legislation with anti-terrorist financing legislation is there-
fore at least problematic, if not dangerous. Returning to the example of foreign
students in the U.S. proves the point. Guest students from Muslim countries
often receive money transfers from their parents to pay their tuition fees. These
transfers have been labeled as highly suspicious because the remittee has the—
stereotypical—profile of a potential terrorist (young, male, Muslim).
This leaves one broad class of cost-raising counter-terrorism measures
which the U.S. made extensive use of in the aftermath of 9/11: intelligence and
military actions. As for the case of intelligence services, Brück et al. report that
their counter-terrorism activities have repeatedly weakened the operative ca-
pacity of terrorist organizations.43 These activities may include infiltration
through the use of informers and undercover agents, observation or information
gathering and analysis. If effective and successful, measures by the security
forces may lead to the quick breakdown of a terrorist group, potentially before
a single shot is fired. More extreme forms of intelligence activities include the
decapitation of terrorist groups—i.e., the killing of terrorist leaders—which
may also prove helpful against already established terrorist groups, although
the evidence does not necessarily speak in favor of these high hopes.44
There are at least three reasons why intelligence measures have often been
found largely ineffective.45 First, this may be simply due to a lack of coopera-
tion between various security agencies. This is especially true for the U.S. with
its many different intelligence services, but also with respect to international
intelligence (non-)cooperation. Second, the organizational structure and ideol-
ogy of a terrorist group may matter. The more decentralized and covert a ter-
rorist organization or network is, the more difficult counter-terrorism intelli-
gence becomes. Third, intelligence and military efforts may be evaluated
differently depending on the targets of these efforts. For instance, Zussman and
Zussman find that stock markets in Israel respond differently to news about the
assassination of members of Palestinian terrorist organization depending on the
role these members play their organizations.46 In addition, one should always
41 Sandler (2005).
42 Krieger and Meierrieks (2013).
43 Brück, Meierrieks and Schneider (forthcoming).
44 See, for instance, Jordan (2009).
45 See Brück, Meierrieks and Schneider (forthcoming).
46 Zussman and Zussman (2006).
How to Deal with International Terrorism 21
be aware of the problem that the experience of counter-terrorism violence by
an aggrieved population may amplify radicalization and popular support for
terrorism, i.e., terrorism results in counter-terrorism which in turn breeds even
more terrorism (a vicious cycle which is difficult to entangle empirically).47
When it comes to international terrorism and especially when state sponsor-
ship is suspected, military measures (e.g., military interventions, retaliatory
strikes) against terror-exporting countries are often chosen as prime strategy in
the fight against terrorism. These measures are not only used to increase the
material costs of terrorism by inflicting direct damage (e.g., destruction of ter-
rorist infrastructure), but also for deterring future attacks by showing credible
commitment. In some cases, military strikes have been directed against terrorist
organizations, in other cases, against their state sponsors directly. In the after-
math of 9/11, the U.S. attacked both types of targets: Al Qaeda as well as its
supposed sponsor, the Taliban government of Afghanistan. Typically, such
strikes yield some success in the short run but there is little evidence that such
measures have the desired long-run effects.48 This is because terrorist organi-
zations are likely to adapt to the threat of military actions. For instance, they
may increasingly resort to network structures, which makes terrorist groups
more mobile and elusive, increasing the difficulty for the military to attack
them. Deterrence against state sponsors of terrorism is more credible and thus
more likely to prove successful, given that states are naturally far less able to
avoid military punishment.49 However, such deterrence need not work auto-
matically. What is more, military (and to a lesser degree intelligence) measures
usually produce high economic costs (e.g., associated with the deployment of
troops, police etc.). Its political costs may also be substantial, given that there
appears to be a thin line between legitimate and illegitimate counter-terrorism
means, where the latter may include a disregard for privacy, the excessive use
violence and torture, politically motivated imprisonments und extrajudicial kill-
ings.50
F. Changing the Environment in Terrorism-Exporting
Countries to the Better
The previous section has considered several of the most popular counter-terror-
ism measures, all of them aiming at raising the costs of terrorist activities but
47 See, for instance, Jaeger, Klor, Miaari and Paserman (2012).
48 See, for instance, Brophy-Baermann and Conybeare (1994) for an evaluation of the suc-
cess of Israeli retaliatory strikes against PLO targets, or Eland‘s (1998) discussion of the 1986
U.S. raid on Libya.
49 Levine and Levine (2006).
50 Piazza and Walsh (2009).
22 Tim Krieger and Daniel Meierrieks
with—apparently—limited hopes to ultimately end terrorist activities. Argua-
bly, a more promising strategy is to dry out popular support for terrorist groups
through raising opportunity costs and reducing benefits of terrorism. Popular
support is important to the emergence and persistence of terrorism as it may,
e.g., facilitate recruitment, provide terrorist groups with material resources and
other means that enable terrorist operations and affect the bargaining power of
a terrorist group. Paul finds that popular support for terrorism is prominently
shaped by grievances shared by terrorism supporters and active terrorists.51
Intuitively, counter-terrorism may try—by “winning the hearts and minds”
of terrorism supporters—to ameliorate specific grievances to curb popular sup-
port, thereby reducing terrorism. However, there is little consensus on the im-
portance of specific social conditions (i.e., grievances) in the emergence of ter-
rorism in the literature.52 In particular, the evidence does not consistently
indicate whether terrorism is rooted in economic or politico-institutional under-
development, including a weak rule of law (or an international law which
shapes the global order in favor of Western countries, as terrorists may claim).
As economic and political development usually interact with other social phe-
nomena, the identification of the “true” social correlates of terrorism is further
complicated. Overall, the evidence—on both factors affecting terrorism di-
rectly and grievances experienced by its supporters—does not point to an obvi-
ous “panacea” to fight terrorism by favorably affecting its opportunity costs
and, indeed, winning the very hearts and minds of terrorism supporters.53
What is more, even when the “true” grievances of terrorism and terrorism
support are identified, this does not necessarily mean that violence ends. For
one, counter-terrorism efforts that address grievances may in fact make terrorist
factions (within an organization) more extreme, given that individuals with
moderate views are increasingly less likely to join or support it when non-vio-
lent opportunities abound. Bueno de Mesquita argues that ameliorating terror-
ism’s root causes can fuel extremism to such an extent that the aggregate level
of violence is unaffected, as smaller but more extreme groups can be just as
violent as larger but more moderate groups.54 For another, supporting countries
from outside to reduce grievances may not (initially) be welcomed by parts of
the domestic population, including terrorists and their supporters, because the
aid donors are often seen as intruders. Furthermore, it would be naive to believe
that foreign nations have sufficient expertise to channel money and other forms
of support to the most suitable places, persons and institutions. The U.S. expe-
51 Paul (2010).
52 See the literature reviews by Gassebner and Luechinger (2011) and Krieger and Meier-
rieks (2011).
53 Brück, Meierrieks and Schneider (forthcoming).
54 Bueno de Mesquita (2008).
How to Deal with International Terrorism 23
rience in Afghanistan and Iraq are a case in point. Finally, one should not dis-
regard the above discussed free-rider problem in the international community
of (potential) donors.
Hence, although reducing grievances and political support to terrorist groups
in terrorism-exporting appears to be a promising strategy against international
terrorism, it is both for practical and theoretical reasons the most difficult and
time-consuming strategy to be implemented. In the face of the terrorist threat,
governments therefore prefer counter-terrorism strategies which increase the
costs of terrorism.
G. Conclusions
Against the background of the existing threat through international terrorism in
many countries, this chapter has analyzed the options for dealing effectively
with this problem. Using the rational-choice approach we identified three main
strategies: raising the costs of terrorism, increasing its opportunities costs and
reducing its benefits. The interplay of costs, opportunity costs and benefits in-
deed determines the relative price of terrorism and thus makes terrorism for a
small group of persons an option to (violently) express opposition to existing
socio-economic, politico-institutional and socio-demographic conditions.
While politicians’ action bias leads to an overemphasis of counter-terrorism
measures which raise the costs of terrorism (e.g., protection measures to secure
the homeland), this typically does not remove existing grievances that likely
drive terrorism. Hence, different measures trying—although with non-negligi-
ble problems—to tackle grievances directly and reduce political support for ter-
rorism are more likely to resolve the terrorism problem, but are less likely to be
introduced by democratic government that strives for re-election.
The rule of law belongs to the set of politico-institutional variables which
may affect the level of terrorism. Its strength is determined ex ante, but its work-
ing under the extreme conditions of terrorism is difficult to anticipate. On the
one hand, if the application of the rule of law (possibly allowing for some ad-
aptations under extreme conditions) is credible and foreseeable a country’s re-
silience is greater. Also, a strong rule of law usually goes along with other
strong institutions which is helpful to keep violent protest at low levels. Em-
phasizing, e.g., civil rights may, on the other hand, limit the permissible scope
for counter-terrorism measures by the police or intelligence services, thereby
reducing the direct costs terrorist groups face. Societies need to carefully weigh
the costs and benefits of the ex ante application of the rule of law and the spec-
ification of permissible legal instruments for the case that extreme condition
abound. In this process, however, it is important to keep an eye on the alterna-
tives, namely determining the rule of law during extreme conditions or even
justifying its ad hoc application ex post. Given governments’ action bias, the
24 Tim Krieger and Daniel Meierrieks
costs for society are most likely higher then under the ex ante application. The
post-9/11 U.S. provides support for this point.
This chapter’s discussion should have made clear that the international law
is a legal instrument which usually lags behind the reality of actual terrorist
incidents. Due to the existing coordination failure in the international arena
(with strong unilateral incentives not to cooperate because of specific national
interests) it needs extreme conditions to achieve progress at all. However, this
progress suffers from action bias again and may reflect the interests of specific
groups of (Western) countries only. In this sense, the international law may
itself contribute to perceived grievances from an “unjust” or “Western-domi-
nated” global order.
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