Abstract
This paper, in its constituent essays, suggests a framework for analytical treatment of terrorist problems and then brings out the importance of financial and socio-economic factors. The framework is discussed in Essay I which classifies the various causes of terrorism into necessary, precipitating, facilitating and perpetuating factors. The presence of a leader is a necessary factor without which terrorism cannot be generated. Poverty and unemployment, however, might only be one out of many facilitating factors which might be rendered redundant without the necessary factor or precipitating factors. Both Essay I and Essay II point out that though poverty is a motivating factor, it might be an inhibitor as far as actual implementation of terrorist acts is concerned. This explains the lack of significance of poverty as a cause of terrorism in some recent econometric studies. Such important financial aspects, which should be incorporated in any study linking poverty to terrorism, have not been given due importance in the literature. Essay II analyses the implications of the financial side of terrorism for the relationship between the incidence of terrorism and affluence. It is assumed that the number of recruits who volunteer to join a terrorist outfit is declining in the level of affluence. Yet the actual incidence of terrorism does not mimic this relationship. This is because of the financial side of terrorism and its implication that the incidence of terrorism is determined not just by the willingness to terrorize but also the ability to terrorize. An illustration of economic causes is developed in Essay III. Terrorism has led to immense loss of life and property in North-eastern India apart from destroying the momentum of economic development. The essay reviews the development indicators in the North-Eastern States of India and tries to shed light on the causation which has led to the association between high incidence of terrorist activity and the low level of affluence in this region. The essay concludes that poor infrastructure might be a cause for both outcomes. An imbalance is also created by the high level of literacy which facilitates the creation of discontented politically motivated terrorist groups as a reaction to the mentioned outcomes. See link at http://www.gipe.ernet.in/working%20paper/mitra_working%20paper.pdf
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