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Foreign aid and terrorist groups: incidents, ideology, and survival

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Abstract

During recent decades, terrorist groups have sought refuge in weak or failed states from which to launch their attacks. Foreign aid to states harboring those groups may or may not be an effective counterterrorism strategy. The current paper investigates that strategy from resident terrorist groups’ perspectives while accounting for their ideologies. In particular, we investigate how conflict aid and other forms of assistance affect the number of domestic and transnational terrorist incidents perpetrated by resident groups of religious, leftist, or nationalist orientations. Our analysis indicates that aid influences not only resident groups’ terror campaigns but also their survival prospects. Groups’ ideologies play important roles in counterterrorism aid’s effectiveness. To address possible aid-terrorism endogeneity, our regressions rely on novel instruments.

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Notes

  1. Coggins (2015), Lai (2007), and Piazza (2008) view such states as attracting resident terrorist groups. However, George (2018) offers a different perspective that failing states are unattractive environments for terrorist groups, given their infrastructure shortfalls and residents’ distrust of foreigners.

  2. Azam and Delacroix (2006), Azam and Thelen (2010), Boutton and Carter (2014), and Young and Findley (2011) focus on aid and transnational terrorism, while Savun and Tirone (2018) examine aid and domestic terrorism.

  3. Kis-Katos et al. (2014) also separate terrorist groups according to their ideologies; however, they explain the determinants of each ideologically based type of attack. We are, instead, interested in how terrorists’ ideologies affect total terrorist attacks and terrorist group survival in light of conflict and governance aid.

  4. These actions and others correspond to codes 15200 to 15261 in AidData (2017). See Tierney et al. (2011) on the construction of AidData.

  5. In AidData (2017), governance aid corresponds to codes 15000 to 15150.

  6. This exclusion is necessary since no data are available on individual countries’ contributions to conflict or governance aid subsequently given by those organizations.

  7. That conclusion follows because \(\exp \left[ {\ln \left( {1.107} \right) \times \ln \left( {1.01} \right)} \right] - 1 = 0.00101\). Other ln(IRR) values are transformed similarly. Henceforth, we just present the transformed values.

  8. The conclusion follows because \(\exp \left[ {\ln \left( {0.922} \right) \times \ln \left( {1.01} \right)} \right] - 1 = - 0.00081\).

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Acknowledgements

The authors have profited from insightful comments by two anonymous reviewers and William F. Shughart II on earlier drafts.

Funding

Funding was provided by Vibhooti Shukla Endowment at University of Texas at Dallas.

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Authors and Affiliations

  1. Department of Economics and Law, Korea Military Academy, 574 Hwarang-ro, Seoul, Republic of Korea

    Wukki Kim

  2. Department of Economics, School of Economic, Political and Policy Sciences, University of Texas at Dallas, 800 W. Campbell Road, Richardson, TX, 75080, USA

    Todd Sandler

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Correspondence to Todd Sandler.

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Kim, W., Sandler, T. Foreign aid and terrorist groups: incidents, ideology, and survival. Public Choice 189, 139–160 (2021). https://doi.org/10.1007/s11127-020-00866-7

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