Document Type : Research Paper


1 Ph.D. Candidate, Department of Economics, Shiraz Branch, Islamic Azad University, Shiraz

2 Assistant Professor and Faculty Member, Department of Economics, Shiraz Branch, Islamic Azad University, Shiraz


Providing security is one the most important prerequisites of economic developement and the main economical effects of security are mirrored in investments and economic growth. Terrorism and its consequences are far more damaging than fear, panic and personal and financial loss. Terrorism negatively effects tourism, investments, international commerce, energy and finally economic growth. The purpose of this study was to review the effects of terrorism on economic growth on middle-eastern countries on a period between 1980-2019 with an approach based on spatial composite econometrics. Prior to estimation of spatial model, spacial excess effects were confirmed via Moranz and GC spatial correlation tests. Results showed that terrorism and its side effects had meaningful negative effects on the economic growth of the countries which were subject of this study. Results indicates that terrorist actions should be considered as an important variable on regional growth studies for the countries which are in the neighborhood of the terrorism affected countries. Furthermore, based on the other findings of this study, human development index, direct foreign investments, bank credits and international commerce has a possitive meaningful effect on economic growth , while inflation rate has a many meaningful negative effect on economic growth of the countries.


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