First, who are terrorists? Contrary to conventional wisdom, terrorists are often not poor – more usually middle-class – and not illiterate, actually relatively well-educated. So if supply of terrorist volunteers isn’t powered by ignorance, it could be provoked by an education that preached hatred; if not driven by material poverty, perhaps fuelled by the injustice of poverty, or outrage at oppression. In any case, terrorists are not people who have nothing to live for. 

The personal cost-benefit of a suicide bomber remains stark: the downside is almost-certain death. How can economics explain this? It appears that being a suicide-bomber implies altruism, in that you sacrifice your own relatively good life for the benefit of others. Kreuger points out: "these are people who believe in something so strongly that they are willing to die for it."

The economic analysis of suicide in the US models the rational choice of a miserable individual (Marcotte, D E, ‘The Economics of Suicide Revisited,’ Southern Economic Journal, Vol 69, No 3, 2003, pp 628-43). A failed suicide appears likely to obtain family or medical support that they couldn’t otherwise have got, and does materially better as a result, which outweighs the possibility of death. In contrast, the suicide bomber seeks an ideological goal for the benefit of others and, having been chosen for executive competence, typically ends up dead. Both models need other people to make individual choice rational. The difference is that suicide bombers believe the benefits go to others, making the cost-benefit calculation harder to sustain. 

Kreuger then asks: from where do terrorists come? His answer is: from societies which lack civil liberties and political freedoms. In other words, more human rights, fewer terrorists. There is an opportunity here: multi-nationals can mitigate business risks through initiatives such as the Voluntary Principles on Security and Human Rights, a code of conduct created by extractives companies, human rights NGOs, and the US and UK governments in the late 1990s, which also contribute to broader civil liberties. 

The third lecture asks whether terrorists succeed; if they don’t, they can’t attract volunteers. One view is that terrorism works because it affects the broad mass of society. The other view says that it doesn’t have a material impact because only a small share of capital and labour are directly affected. 

So the terrorist’s success partly depends on us. After 9/11, IRA-hardened Britons in the US typically got on with life: refusing to be bothered defeats the terrorists’ purpose. But for most Americans, the first foreign attack on US soil since Pearl Harbor was a bigger disruption. Kreuger suggests that: "Terrorism, as we have experienced it so far, only matters in a big way if we let it matter."

This book gives a wide-ranging view of an eclectic, and often incisive, literature. The transition from engaging lecture script to tightly-written text could be sharper, but this is an effective summary of fresh and current thinking.