Terrorism, Regime Type, and Defense Spending: A Cross-National Analysis

A small number of studies have investigated how terrorism influences government policies such as military spending through individual case-study analyses. However, scholars have yet to investigate how terrorism influences defense funding across multiple states and regions. This is surprising since prior research has found that terrorism influences political outcomes a number ways by affecting citizens' emotions such as anxiety and fear. Therefore, this study examines the effect domestic and international terrorism has on military expenditures in 119 states from 1989 to 2012. A cross-sectional time series analysis indicates that terrorism positively affects military spending. However, democratic states are more likely to increase defense funding following terrorist attacks than authoritarian states. Furthermore, international terrorist attacks have the largest effect on defense funding in democracies.