The macroeconomic consequences of terrorism

We perform an empirical investigation of the macroeconomic consequences of international terrorism and interactions with alternative forms of collective violence. Our analysis is based on a rich unbalanced panel data set with annual observations on 177 countries from 1968 to 2000, which brings together information from the Penn World Table data set, the ITERATE data set for terrorist events, and data sets of external and internal conflict. We explore these data with cross-sectional and panel growth regression analysis and a structural VAR model. We find that, on average, the incidence of terrorism may have an economically significant negative effect on growth, albeit one that is considerably smaller and less persistent than that associated with either external wars or internal conflict. As well, terrorism is associated with a redirection of economic activity away from investment spending and towards government spending. However, our investigation also suggests important differences both regarding the incidence and the economic consequences of terrorism among different sets of countries. In OECD economies, in particular, terrorist incidents are considerably more frequent than in other nations, but the negative influence of these incidents on growth is smaller.     

International Terrorism: Causes,Consequences and Cures

A popular view is that international terrorism is on the increase, that it is religiously motivated and that it has important adverse consequences. This paper investigates this view. It examines the empirical evidence on the causes of international terrorism from the late 1960s to the early 2000s and discovers that, while religion has had a part to play, explanations based on economics and politics appear to be consistent with the facts. Terrorists come from relatively poor and undemocratic countries and commit attacks in relatively rich and democratic ones. The paper then examines the micro, macro and global economic effects of international terrorism from both a theoretical and empirical angle, and discovers that the negative effect on domestic aggregate demand is temporary and the effect on aggregate supply insignificant. Finally, the paper explores policies to deal with international terrorism and demonstrates that this is complex. Analogies with conventional crime may be unhelpful.     

SCREENING ETHICS WHEN HONEST AGENTS CARE ABOUT FAIRNESS*

A principal faces an agent with private information who is either honest or dishonest. Honesty involves revealing private information truthfully if the probability that the equilibrium allocation chosen by an agent who lies is small enough. Even the slightest intolerance for lying prevents full ethics screening whereby the agent is given proper incentives if dishonest and zero rent if honest. Still, some partial ethics screening may allow for taking advantage of the potential honesty of the agent, even if honesty is unlikely. If intolerance for lying is strong, the standard approach that assumes a fully opportunistic agent is robust.     

A MODEL OF VOTER CHOICE IN A LIFE-CYCLE SETTING

This paper employs an overlapping generations framework in which voters choose political parties based on the economic shocks faced over their lifetimes. Parties internalize voting preferences and develop platforms based on this information. The resulting equilibrium implies that voters select parties that maximize income in their labor period and that minimize inflation in their retirement period. The equilibrium also has the property that individuals switch their votes between the parties, in the presence of adverse states of nature. These results provide an explanation for post World War II voting patterns in the United States. The paper also provides empirical support for the theoretical findings.     

Terrorism and the Invisible Hook

This article investigates and compares the root causes of transnational terrorism and piracy. In order to accomplish this, we construct a novel data set that catalogues terrorist activity and piracy over the years 1992–2008, paying particular attention to the Arabian Sea and Indian Ocean since 1991. These data are then merged with other information detailing the economic, political, and security posture of each organization during the same period so that we can examine the relationship between economic prosperity, security, terrorism, and piracy. The main conclusion is that terrorism is mostly unrelated to economic conditions, while piracy responds to both economic payoffs and military deterrents.     

Screening Ethics when Honest Agents Keep their Word

Using a principal-agent setting, we introduce honesty that requires pre-commitment. The principal offers a menu of mechanisms to screen ethics. Agents may misrepresent ethics. Dishonest agents may misrepresent the match with the assigned task (good or bad), while honest agents reveal the match honestly if they have pre-committed. Ethics-screening, that allows for match-screening with dishonest agents while leaving a lower rent to honest agents, is optimal if both honesty and a good match are likely. Otherwise the optimal mechanism is the standard second-best or the first-best (where dishonest agents misrepresent the match), if dishonesty is likely or unlikely respectively.An earlier version of this paper was entitled “Honest Agents and Equilibrium Lies.” We are grateful to seminar participants at MIT, Université de Caen, University of St Andrews, University of Virginia, and ESEM 99, and two anonymous referees for useful comments.     

New wine in old wineskins? Growth,terrorism and the resource curse in sub-Saharan Africa

Since 1995, growth in sub-Saharan Africa has averaged more than 5% per year reversing a two-decade decline of real income per capita. In this paper, we explore the extent to which the nascent growth is sustainable or not due to higher incidences of terrorism and commodity price declines. Our analysis is based on a rich unbalanced panel data set with annual observations on 46 countries from 1968 to 2004. We explore these data with cross-sectional and panel growth regression analysis and quantile regressions. We estimate the economic and statistical effect of terrorism on growth in sub-Saharan Africa, controlling for a variety of other factors. We then investigate the extent to which there appears to be a structural break in the estimated relationships. We find that the terrorist-oriented fragility of sub-Sahara has increased in the most recent period. We find that most of the fragility can be explained by the growth in countries that are primary fuel exporters. Indeed, our evidence points to the fact that resource-rich countries have not done an adequate job of investing in counter-terrorist policies.     

‘Don't give us an assignment where we have to use spinach!’: food choice and discourse in home and consumer studies

The aim of the study was to describe classroom Discourses about vegetables during the planning, cooking, eating and evaluation of meals in the Swedish school subject Home and Consumer Studies. Fifty‐nine students and five teachers were recruited from five northern Swedish villages and towns, and then observed, recorded and in some cases video‐taped during lessons that took place between 2010 and 2012. Based on 56 instances of talk about vegetables, four Discourses were identified and related to the three aspects of Belasco's culinary triangle of contradictions: identity, responsibility and convenience. The results indicated that the identity‐based sensory and cultural Discourses sometimes clashed with the more responsibility‐oriented health and evaluation Discourses. The health Discourse was only used when there was an element of evaluation, with assignments connected to grades. In all other cases, the sensory and cultural Discourses guided vegetable use. Sometimes different sensory or cultural assumptions could clash with each other, for example when the teacher insisted on the use of a specific recipe regardless of a student's taste preferences. Since these preferences did not always harmonize with curricular demands for responsibility, there might be a risk of basing grades on aspects of students’ identity. Alternatively, students might feel constrained to argue against their own identity in order to be favourably evaluated. Then again, if teachers always bow to student tastes, this limits their chances of learning about food and physical health. Viewing the dilemma through the lens of the culinary triangle of contradictions may help teachers and researchers develop teaching methods that take all aspects of food choice into account.     

The importance of time frames in Swedish Home and Consumer Studies

The aim of this study was to explore how time frames affect pupils and teachers in cooking activities during lessons of different durations for Home and Consumer Studies, with a specific focus on the pupils’ experiences. To investigate this, classroom observations were carried out in 2011 and 2012, with the help of audio and video recordings in three different schools in Sweden and included altogether 22 pupils (18 girls, 4 boys) in grade 9 (15–16 years). Each class was observed during two separate lessons, lasting between 1 h 50 min (110 minutes) and 2 h 20 min (140 min). The six lessons resulted in 12 h of video recorded time and 80 h of sound recordings. The study showed that the importance of finishing on time seemed to be ingrained in most pupils in all classes and the end result was perceived as more important than the process of cooking. The study also showed that knowledge of cooking skills and time management seemed important for success in grade‐related tasks. Pupils demonstrated different ways of handling the time frames, e.g. using various methods to speed up the cooking process. This study raises important questions about the relationship between national and local time frames and the curriculum aims in Home and Consumer Studies.     

Appreciating Stockbroking: Constructing Conceptions to Make Sense of Performance

ABSTRACT The performance of individual stockbrokers differs. This paper aims to make sense of these differences. In a study of 14 stockbrokers, the high performing brokers described their working life in a systematically different way, compared to the low performing brokers. The brokers gave different and conflicting accounts of what, from an outsider's viewpoint, seemed to be very similar work and working conditions. The brokers’ different accounts are interpreted and reconstructed into two opposing conceptions of stockbrokers’ world of working. In an ideal typical sense these two conceptions make sense of, and maybe even explain the stockbrokers’ different levels of performance.