3 Effects of Terrorism

Topics: Economics, September 11 attacks, World Trade Center Pages: 2 (540 words) Published: November 8, 2012
Everyone who was able to reach the new world of 9/12 is still in shock. They also knew that the devastating event happened the day ago will have an impact in their on how they will live. 3.1 Effects to people

As mentioned earlier, if one of the components of terrorism is to cause fear, we can say that all terrorism attacks can be considered successful. In the interview conducted by John Tierney to Dr. John Mueller, the latter expects that fear will continue for a long time because the images of 9/11 are fixed in people’s mind. However, Stout (2007) 1 trusts that people suffering from terrorphopia can recover. Moreover, Lifton (2003) 2 believes that people affected by these world problems instead of being under threats and pulls tends to be more resilient. 3.2 Effects to the economy

The economic impact of terrorism can be divided into various aspects. There is the damage cost to property, immediate effects to the economy and the long term indirect cost of security. For the 9/11 attack, IAGS3 calculated an estimate of $2 trillion. A big portion of the expenses incurred are due to the cost of the hijacked aircraft, World Trade Center and Pentagon Office, losses to the insurance industry and release of Federal Emergency Fund that was used for the cleaning and rehabilitation program. In addition, the report of OECD4 links terrorism attack to the economic condition of a country as terrorism reduces current and potential investment and slows down economic growth. Unemployment rate increased when jobs were lost due to the destruction of offices. Incoming foreign and local investment lessened as investors lose trust and confidence to the economic stability. Delivery of consumer goods slows down as check points at port and land borders stricken. Furthermore, revenue from tourism decreases as tourist considers their safety. (Drakos & Kutan, 2008)5

The continuing threat of terrorist actions requires all countries to be vigilant and increase their security. The IMF6...
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