Growth and Fiscal Consequences of Terrorism in Nigeria

Chuku, Chuku; Abang, Dominic E.; Isip, Ima-Abasi

doi:10.1080/10242694.2017.1389583

Cited by 25 publications

(20 citation statements)

References 30 publications

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“…This finding substantiates the argument put forward by Gupta et al (2004) that terrorism results in crumbling tax base through devastation of business firms and hampering the tax administration with net outcome of fall in tax revenue collection. Moreover, this outcome corroborates with what have been documented by (Gupta et al, 2004;Cevik & Ricco, 2015;Chuku et al, 2019). Among other determinants of tax revenue, we find that economic growth performance and public spending are positively while inflation rate and foreign aid are negatively associated with…”

Section: Tax Revenue and Terrorism: Role Of Institutional Qualitysupporting

confidence: 91%

“…The armed forces of Pakistan are actively involved in eradicating the evil of terrorism from the country. For the last fifteen years the strict actions have been taken on war footing to secure the homeland from terrorist attacks.Under these circumstances defence spending hasincreased which is more likely to divert the resources of the government from public sector development spending and social sector development programs to military expenditures in Pakistan.The positive relationship between defence spending and terrorism is also documented by (Nasir & Shahbaz, 2015;Gupta et al, 2004;Cevik & Ricco, 2015;Chuku et al, 2019;Zakaria et al, 2019) report that terrorism leads to an increase in overall fiscal spending. The coefficients of economic growth, trade balance, foreign aid and defence spending of India are all positive and significant indicating the vital contribution of these factors in defence spending of Pakistan in the long run.…”

Section: Defence Spending and Terrorism: Role Of Institutional Qualitymentioning

confidence: 79%

“…As our study aims to estimate fiscal response to terrorism in the presence of institutional quality through gauging effect of terrorist incidents on tax revenue collection and defence spending in Pakistan, therefore, terrorism and institutional quality variables have been plugged into the standard econometric models of tax revenue and defence spending. Considering the relevance with our study, we prefer to use modified versions of regression models presented by (Maizels & Nissanke, 1986;Teera, 2003;Gupta et al, 2004;Cevik & Ricco, 2015;Chuku et al, 2019). Thus, to conquer the basic aim of the study we specify the following econometric models:…”

Section: Model Specification and Datamentioning

confidence: 99%

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Fiscal Response to Terrorism in Pakistan: The Role of Institutions

Mukhtar

Jehan

2021

J.quant.methods

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This study empirically estimates the fiscal consequences of terrorism in Pakistan by using annual time series data from 1984 to 2016. By employing the autoregressive distributed lag (ARDL) technique, the study has gauged the impact of terrorist incidents on two important facets of fiscal policy, namely, tax revenue and defense spending. The results reveal that terrorism has detrimental ramifications for fiscal policy in Pakistan. Specifically, on the one hand, an increase in terrorist incidents tends to bring a fall in tax revenue while on the other hand, they induce a rise in defense outlays, thus deteriorating both fronts of the fiscal position. Notably, the moderating role of institutional quality appears significant and indicates that institutional quality has not only a significant direct impact on fiscal policy, but it also helps in completely mitigating (reducing) the harmful impact of terrorism on defense spending (tax revenue) in Pakistan. These findings suggest that there is a need to take appropriate steps for strengthening institutional setup to control the fallouts of terrorism on fiscal behavior of the government of Pakistan. Keywords: Terrorism; Tax Revenue; Institutional Quality; ARDL JEL Classification: E62; H2; E02; H5; F35

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Section: Tax Revenue and Terrorism: Role Of Institutional Qualitysupporting

confidence: 91%

Section: Defence Spending and Terrorism: Role Of Institutional Qualitymentioning

confidence: 79%

Section: Model Specification and Datamentioning

confidence: 99%

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Fiscal Response to Terrorism in Pakistan: The Role of Institutions

Mukhtar

Jehan

2021

J.quant.methods

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“…1 For a related topic, on how terrorism affects the economy, the interested reader can refer to Abadie and Gardeazabal (2003), Chuku et al (2019), and Karolyi and Martell (2010). 2 Earlier examples of studies that have also used a PVAR methodology in the exchange rate literature include Broda (2004) and Grossmann et al (2014).…”

Section: Data Availability Statementmentioning

confidence: 99%

“… 1 1 For a related topic, on how terrorism affects the economy, the interested reader can refer to Abadie and Gardeazabal (2003), Chuku et al (2019), and Karolyi and Martell (2010). …”

mentioning

confidence: 99%

The impact of conflict on the exchange rate of developing economies

Michail

2021

Review Development Economics

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This paper explores the impact different types of conflict have on the nominal exchange rate (NER), using a panel of developing economies. Accounting for NER determinants, the evidence suggests that in addition to the depreciation caused by macroeconomic factors, intra-state (civil) wars have a strong and significant depreciative impact on the exchange rate. In contrast, international wars do not appear to have any excess effect. A potential explanation of this phenomenon is that, unlike international wars where winners and losers are more difficult to distinguish a priori, in civil wars the country is much more likely to face economic deterioration, therefore promoting an over-discounting effect.The findings provide insights for both investors and policymakers given that exchange rate devaluation can likely provide a negative feedback mechanism to the local economy, especially if they hold foreign currency debt. The depreciation could also potentially have strong effects on the long-run growth potential, considering that most developing economies rely on imports of capital goods for research and development purposes.

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Terrorism Impact on Public Debt and Government Borrowing Cost: New Empirical Evidence from Long-Run Relationship in MENA Countries

Mazigh

Khefacha

2022

Key Challenges and Policy Reforms in the MENA Region

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Growth and Fiscal Consequences of Terrorism in Nigeria

Cited by 25 publications

References 30 publications

Fiscal Response to Terrorism in Pakistan: The Role of Institutions

Fiscal Response to Terrorism in Pakistan: The Role of Institutions

The impact of conflict on the exchange rate of developing economies

Terrorism Impact on Public Debt and Government Borrowing Cost: New Empirical Evidence from Long-Run Relationship in MENA Countries

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