NBER Publications by Esteban Klor

The literature on conflict and terrorism has paid little attention to the economic costs of terrorism for the perpetrators. This paper aims to fill that gap by examining the economic costs of committing suicide terror attacks. Using data covering the universe of Palestinian suicide terrorists during the second Palestinian uprising, combined with data from the Palestinian Labor Force Survey, we identify and quantify the impact of a successful attack on unemployment and wages. We find robust evidence that terror attacks have important economic costs. The results suggest that a successful attack causes an increase of 5.3 percent in unemployment, increases the likelihood that the district’s average wages fall in the quarter following an attack by more than 20 percent, and reduces the number of...

his paper examines how violence in the Second Intifada influences Palestinian public opinion. Using micro data from a series of opinion polls linked to data on fatalities, we find that Israeli violence against Palestinians leads them to support more radical factions and more radical attitudes towards the conflict. This effect is temporary, however, and vanishes completely within 90 days. We also find some evidence that Palestinian fatalities lead to the polarization of the population and to increased disaffection and a lack of support for any faction. Geographically proximate Palestinian fatalities have a larger effect than those that are distant, while Palestinian fatalities in targeted killings have a smaller effect relative to other fatalities. Although overall Israeli fatalities do not...