Under Attack: Terrorism and International Trade in France, 2014-16

Terrorist events typically vary along many dimensions, making it difficult to identify their economic effects. This paper analyzes the impact of terrorism on international trade by examining a series three large-scale terrorist incidents in France over period from January 2015 July 2016. Using firm-level data at monthly frequency, we document an immediate and lasting decline cross-border after mass attack. According our estimates, France’s goods, which accounts for about 70 percent country’s goods services, is reduced more than 6 billion euros first six months The reduction mainly takes place intensive margin, with particularly strong effects partner countries low border barriers France, firms less frequent activities homogeneous products. A possible explanation these patterns increase costs due stricter security measures.