The Role of Behavioral Responses in the Total Economic Consequences of Terrorist Attacks on U.S. Air Travel Targets

Adam Rose, Misak Avetisyan, Heather Rosoff, William J. Burns, Paul Slovic, Oswin Chan

Research output: Contribution to journalArticlepeer-review

7 Scopus citations

Abstract

U.S. airports and airliners are prime terrorist targets. Not only do the facilities and equipment represent high-value assets, but the fear and dread that is spread by such attacks can have tremendous effects on the U.S. economy. This article presents the methodology, data, and estimates of the macroeconomic impacts stemming from behavioral responses to a simulated terrorist attack on a U.S. airport and on a domestic airliner. The analysis is based on risk-perception surveys of these two scenarios. The responses relate to reduced demand for airline travel, shifts to other modes, spending on nontravel items, and savings of potential travel expenditures by U.S. resident passengers considering flying domestic routes. We translate these responses to individual spending categories and feed these direct impact results into a computable general equilibrium (CGE) model of the U.S. economy to ascertain the indirect and total impacts on both the airline industry and the economy as a whole. Overall, the estimated impacts on GDP of both types of attacks exceed 10B. We find that the behavioral economic impacts are almost an order of magnitude higher than the ordinary business interruption impacts for the airliner attack and nearly two orders of magnitude higher for the airport attack. The results are robust to sensitivity tests on the travel behavior of U.S. residents in response to terrorism.

Original languageEnglish
Pages (from-to)1403-1418
Number of pages16
JournalRisk Analysis
Volume37
Issue number7
DOIs
StatePublished - Jul 2017

Keywords

  • Airline travel demand
  • economic consequences of terrorism
  • risk perception and decision making

Fingerprint Dive into the research topics of 'The Role of Behavioral Responses in the Total Economic Consequences of Terrorist Attacks on U.S. Air Travel Targets'. Together they form a unique fingerprint.

Cite this