In this paper we develop an empirical model for transnational terrorist activity for a panel consisting of 139 countries over the period [1985][1986][1987][1988][1989][1990][1991][1992][1993][1994][1995][1996][1997][1998]. Essentially, we attempt to sketch the profile of the average terrorist attack venue. Our findings suggest that the terrorist attack venue is, on average, characterized by low economic openness, high demographic stress, and a high level of international disputes. Furthermore, we document a strong regional component suggesting the presence of infectious contagion on a spatial level. Our results also support the presence of addictive contagion captured by a strong autoregressive component in each country's terrorist activity. Finally, we find a weak statistical link between the level of democracy and terrorist activity, although the level of democracy is a significant determinant of the potential under-reporting bias of terrorist activity.

Despite substantial progress in the applied study of terrorism, one important methodological issue has remained underdeveloped. Multiple warnings have urged for caution as the validity of extant findings may have been distorted from the well-known “devil” of underreporting bias. Yet, extant research has fallen short from addressing the issue in a systematic fashion. This article discusses a way for assessing whether underreporting is present by using the widely studied relationship between terrorism and regime type as its laboratory. After formally presenting a setup for the accommodation of underreporting bias, the authors discuss how it relates to press freedom. According to their results, underreporting is indeed present, implying that the used databases for terrorism represent an understatement of the true number of terrorist incidents.

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