Figure 3 - uploaded by Martin Mullins
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maps the level of the FTSE-100 Index for the 22 days prior to and post the bombing of the UN Headquarters.
Source publication
Close examination of the behaviour of participants in financial markets in the aftermath of terrorist attacks is a valuable line of enquiry. In this paper, we bring together insights from field of finance and politics. Specifically, we examine trading patterns on highly liquid insurance-type financial instruments around a specific terrorist event....
Citations
... Added value of EUSECON research is provided by the finding that even remote and minor terrorist incidents may unfold significant repercussions on the US and European markets also driven by perceptions of insecurity. Marvins and Garvey (2010) find evidence that the bombing of the UN headquarter in Iraq in 2003 had a significant impact on trading patterns in the US financial market. The researchers argue that this was still related to the 9/11 attacks which had caused a persistent general feeling of insecurity. ...
This paper presents key aspects and policy implications of a multi-annual research project on economic analyses of European security issues (EUSECON), with an emphasis on intentional threats of organised crime, piracy and terrorism. The first part argues that rational models can provide significant insights on the emergence and current patterns of terrorism and piracy. These findings could lead to new priorities or to more nuanced interventions in response to these threats. The second part focuses on the direct and indirect costs of both terrorism and organised crime. EUSECON provided new data about the scope of related illegal economic activities and explored the sensitivity of markets, societies and polities in the aftermath of terrorist attacks. It emerges that political actors are at greatest risk of over-responding, whereas mature economies display a high degree of resilience. Finally, the third part discusses economic approaches to policy evaluation. EUSECON clarified the benefits of transnational security cooperation, but also highlights the difficulties of rigorous costeffectiveness and cost-benefit calculations. Therefore, a more evidence-based approach to security policymaking, which is increasingly touted by EU decision-makers, remains elusive. In conclusion, European security policy needs further scrutiny from an economic perspective, in order to answer the increasing complexity of security challenges under the increasing financial or political constraints.
