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The Interplay Between Preemptive and Defensive Counterterrorism Measures: A Two-Stage Game

A two-stage game depiction of counterterrorism is presented, where the emphasis is on the interaction between the preemptive and defensive measures taken by two targeted countries facing a common threat. The preemptor is likely to be the high-cost defender with the greater foreign interests. A prime-target country may also assume the preemptor role. The analysis identifies key factors – cost comparisons, foreign interests, targeting risks, and domestic terrorism losses – that determine counterterrorism allocations. The study shows that the market failures associated with preemptive and defensive countermeasures may be jointly ameliorated by a disadvantaged defender. Nevertheless, the subgame perfect equilibrium will still be suboptimal owing to a preemption choice that does not fully internalize the externalities.

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https://doi.org/10.20955/wp.2008.034

https://doi.org/10.1111/j.1468-0335.2009.00823.x


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