12 Terrorism and Insurgencies: Non-State Violence, Geoeconomic Exposure, and Empirical Monitoring

Terrorism and insurgencies are best understood, in a geoeconomic register, as strategies of coercion and bargaining pursued by non-state actors under conditions of asymmetry. Their distinguishing feature is not only the use of violence, but the selective targeting of economic nodes, political legitimacy, and institutional capacity. Contemporary non-state actors operate across borders, exploit weak governance and porous corridors, and adapt rapidly to countermeasures. The resulting security challenge is simultaneously strategic and economic: episodes of violence alter investment incentives, disrupt logistics and tourism, raise insurance premia, shift public budgets toward security expenditures, and can reconfigure trade routes and supply chains. In that sense, terrorism is not merely a “security” phenomenon appended to international business; it is a driver of risk pricing and location decisions in an interdependent world.

The empirical study of terrorism has advanced substantially because many relevant outcomes are observable and can be monitored systematically. Event-level datasets have enabled analysts to document where violence occurs, how it evolves over time, and how it diffuses across space. These empirical approaches do not replace interpretive judgment; they discipline it by making patterns and regularities visible. The core analytical task is to connect violence to geoeconomic mechanisms: how non-state actors exploit corridor vulnerabilities, how states respond through security policies and border regimes, and how firms adapt through risk mitigation and reallocation of exposure.

12.1 The geography of non-state violence and the political economy of corridors

Non-state violence is geographically structured. It clusters in regions where state capacity is contested, where terrain and borders provide operational depth, and where illicit economies can finance organization. These are not merely tactical features; they are economic features. Borderlands, remote regions, and urban peripheries often combine low monitoring capacity with high opportunities for rent extraction, taxation of flows, and coercion of local populations. From a geoeconomic viewpoint, the relevant unit is frequently the corridor rather than the country: road networks, ports, pipeline routes, and trade hubs that concentrate flows and therefore concentrate both opportunity and vulnerability.

Event datasets make these spatial patterns measurable. The Armed Conflict Location & Event Data Project (ACLED), introduced in the scholarly literature as a disaggregated dataset recording the location and timing of political violence and protest events, enables hotspot analysis and spatial diffusion models (Raleigh et al. (2010)). These tools are analytically useful because they make it possible to distinguish between persistent structural risk (areas with chronic violence) and episodic risk (spikes around political or military events), which is precisely the distinction that matters for investment horizons and supply chain design.

A complementary source for terrorism-specific incidents is the Global Terrorism Database, widely used in research to track terrorist attacks across countries over long time spans (National Consortium for the Study of Terrorism and Responses to Terrorism (START) (2023)). When combined with governance and development indicators, such datasets support empirical regularities that are policy-relevant: violence tends to concentrate where legitimacy is contested and where coercion is economically sustainable through control of flows, external funding, or illicit markets.

12.2 Networks of organization: finance, recruitment, and coalition structure

Insurgencies and terrorist organizations are commonly described as “decentralized networks,” but the geoeconomic question is more specific: which nodes are essential for sustaining capacity over time? Recruitment pipelines, financing mechanisms, and logistics chains tend to exhibit bottlenecks even when violence is executed through distributed cells. This is why network thinking is helpful as an organizing metaphor and as an empirical approach, provided that one remains clear about the limits of inference and about the ethical constraints of analysis.

The financing dimension is particularly salient. Informal value transfer systems, including hawala-like mechanisms, have long been analyzed as channels through which funds can move across borders outside conventional banking oversight, raising regulatory and enforcement challenges (Passas (2003)). The geoeconomic relevance is not limited to counterterrorism policy; it extends to the integrity of trade finance, remittance channels, and the compliance costs borne by legitimate firms operating in high-risk regions.

Recruitment and propaganda dissemination increasingly rely on digital ecosystems, which interact with diaspora networks and grievance structures. Empirical work on extremist online presence has documented that platform affordances can facilitate community formation and amplification dynamics, even when conversion from exposure to mobilization remains contingent (Berger and Morgan (2015)). For geoeconomics, these findings matter because online mobilization can shift the risk profile of societies without corresponding changes in conventional military indicators, thereby affecting perceptions of stability and the credibility of state commitments.

12.3 Predictive inference and early-warning logic

Empirical monitoring also supports early-warning analysis. The relevant objective is not deterministic prediction of specific attacks—an unrealistic and often conceptually misguided aim—but probabilistic identification of elevated risk across space and time. This logic is consistent with work in conflict studies that links violence to accessibility, state reach, and territorial conditions. For example, research on insurgency and inaccessibility emphasizes that geography conditions state control and insurgent survivability, shaping the spatial distribution of violence (Tollefsen and Buhaug (2015)). Such findings translate naturally into geoeconomic risk assessments: where accessibility constraints are binding, transport corridors become vulnerable, enforcement costs rise, and the shadow economy can expand.

A parallel literature in political economy evaluates whether policy instruments can reduce violence by altering incentives and information. Work on counterinsurgency in Iraq, for instance, analyzes how resource allocation affects violence through “hearts and minds” mechanisms and the strategic interaction between civilians, insurgents, and intervening forces (Berman, Shapiro, and Felter (2011)). For a geoeconomic argument, the contribution is conceptual: violence is not only a function of ideology; it is shaped by incentives, governance capacity, and the distribution of economic rents. This is precisely why terrorism is responsive to economic shocks, border regimes, and the structure of illicit markets.

12.4 Geoeconomic implications: investment, fragmentation, and resilience

The geoeconomic consequences of terrorism and insurgency are rarely confined to direct damages. They operate through risk premia, reallocation, and institutional adaptation. Investment tends to shift away from exposed locations unless offset by resource rents or state guarantees; tourism and services are especially sensitive to perceived insecurity; logistics networks become more redundant and therefore more costly; and public spending is reallocated toward security at the expense of infrastructure and social investment. In highly connected economies, localized violence can produce non-local effects by disrupting corridors and altering the expected reliability of supply chains. The result is a form of endogenous fragmentation: economic actors respond to insecurity by reducing exposure, which can weaken local economies and thereby expand the conditions under which non-state actors can recruit and extract rents.

These dynamics also clarify why “tracking” non-state actors is not merely an intelligence exercise. It is part of geoeconomic governance: states and firms seek to stabilize corridors, maintain credible commitments, and preserve the predictability required for trade, investment, and development. Event datasets and systematic monitoring contribute by making these vulnerabilities legible and by supporting the evaluation of interventions, but they do not substitute for political settlement and institutional legitimacy, which remain the central determinants of long-run stability.

12.5 Conclusion

Terrorism and insurgencies should be analyzed as forms of strategic violence that exploit economic connectivity, institutional weaknesses, and corridor vulnerabilities. Empirical monitoring—through event datasets and systematic measurement—helps document where violence concentrates, how it evolves, and which structural conditions correlate with persistence. Yet the core interpretive task for geoeconomics remains to connect these patterns to mechanisms: the pricing of risk, the restructuring of trade and investment, and the governance choices through which states and firms attempt to preserve resilience under insecurity. In a fragmented global landscape, non-state violence is therefore not only a security threat; it is a driver of economic reconfiguration and an enduring constraint on globalization’s institutional foundations.

# Terrorism and Insurgencies: Non-State Violence, Geoeconomic Exposure, and Empirical Monitoring Terrorism and insurgencies are best understood, in a geoeconomic register, as strategies of coercion and bargaining pursued by non-state actors under conditions of asymmetry. Their distinguishing feature is not only the use of violence, but the selective targeting of economic nodes, political legitimacy, and institutional capacity. Contemporary non-state actors operate across borders, exploit weak governance and porous corridors, and adapt rapidly to countermeasures. The resulting security challenge is simultaneously strategic and economic: episodes of violence alter investment incentives, disrupt logistics and tourism, raise insurance premia, shift public budgets toward security expenditures, and can reconfigure trade routes and supply chains. In that sense, terrorism is not merely a “security” phenomenon appended to international business; it is a driver of risk pricing and location decisions in an interdependent world. The empirical study of terrorism has advanced substantially because many relevant outcomes are observable and can be monitored systematically. Event-level datasets have enabled analysts to document where violence occurs, how it evolves over time, and how it diffuses across space. These empirical approaches do not replace interpretive judgment; they discipline it by making patterns and regularities visible. The core analytical task is to connect violence to geoeconomic mechanisms: how non-state actors exploit corridor vulnerabilities, how states respond through security policies and border regimes, and how firms adapt through risk mitigation and reallocation of exposure. ## The geography of non-state violence and the political economy of corridors Non-state violence is geographically structured. It clusters in regions where state capacity is contested, where terrain and borders provide operational depth, and where illicit economies can finance organization. These are not merely tactical features; they are economic features. Borderlands, remote regions, and urban peripheries often combine low monitoring capacity with high opportunities for rent extraction, taxation of flows, and coercion of local populations. From a geoeconomic viewpoint, the relevant unit is frequently the corridor rather than the country: road networks, ports, pipeline routes, and trade hubs that concentrate flows and therefore concentrate both opportunity and vulnerability. Event datasets make these spatial patterns measurable. The Armed Conflict Location & Event Data Project (ACLED), introduced in the scholarly literature as a disaggregated dataset recording the location and timing of political violence and protest events, enables hotspot analysis and spatial diffusion models (@raleigh_linke_hegre_karlsen2010). These tools are analytically useful because they make it possible to distinguish between persistent structural risk (areas with chronic violence) and episodic risk (spikes around political or military events), which is precisely the distinction that matters for investment horizons and supply chain design. A complementary source for terrorism-specific incidents is the Global Terrorism Database, widely used in research to track terrorist attacks across countries over long time spans (@gtd2023). When combined with governance and development indicators, such datasets support empirical regularities that are policy-relevant: violence tends to concentrate where legitimacy is contested and where coercion is economically sustainable through control of flows, external funding, or illicit markets. ## Networks of organization: finance, recruitment, and coalition structure Insurgencies and terrorist organizations are commonly described as “decentralized networks,” but the geoeconomic question is more specific: which nodes are essential for sustaining capacity over time? Recruitment pipelines, financing mechanisms, and logistics chains tend to exhibit bottlenecks even when violence is executed through distributed cells. This is why network thinking is helpful as an organizing metaphor and as an empirical approach, provided that one remains clear about the limits of inference and about the ethical constraints of analysis. The financing dimension is particularly salient. Informal value transfer systems, including hawala-like mechanisms, have long been analyzed as channels through which funds can move across borders outside conventional banking oversight, raising regulatory and enforcement challenges (@passas2003). The geoeconomic relevance is not limited to counterterrorism policy; it extends to the integrity of trade finance, remittance channels, and the compliance costs borne by legitimate firms operating in high-risk regions. Recruitment and propaganda dissemination increasingly rely on digital ecosystems, which interact with diaspora networks and grievance structures. Empirical work on extremist online presence has documented that platform affordances can facilitate community formation and amplification dynamics, even when conversion from exposure to mobilization remains contingent (@berger_morgan2015). For geoeconomics, these findings matter because online mobilization can shift the risk profile of societies without corresponding changes in conventional military indicators, thereby affecting perceptions of stability and the credibility of state commitments. ## Predictive inference and early-warning logic Empirical monitoring also supports early-warning analysis. The relevant objective is not deterministic prediction of specific attacks—an unrealistic and often conceptually misguided aim—but probabilistic identification of elevated risk across space and time. This logic is consistent with work in conflict studies that links violence to accessibility, state reach, and territorial conditions. For example, research on insurgency and inaccessibility emphasizes that geography conditions state control and insurgent survivability, shaping the spatial distribution of violence (@tollefsen_buhaug2015). Such findings translate naturally into geoeconomic risk assessments: where accessibility constraints are binding, transport corridors become vulnerable, enforcement costs rise, and the shadow economy can expand. A parallel literature in political economy evaluates whether policy instruments can reduce violence by altering incentives and information. Work on counterinsurgency in Iraq, for instance, analyzes how resource allocation affects violence through “hearts and minds” mechanisms and the strategic interaction between civilians, insurgents, and intervening forces (@berman_shapiro_felter2011). For a geoeconomic argument, the contribution is conceptual: violence is not only a function of ideology; it is shaped by incentives, governance capacity, and the distribution of economic rents. This is precisely why terrorism is responsive to economic shocks, border regimes, and the structure of illicit markets. ## Geoeconomic implications: investment, fragmentation, and resilience The geoeconomic consequences of terrorism and insurgency are rarely confined to direct damages. They operate through risk premia, reallocation, and institutional adaptation. Investment tends to shift away from exposed locations unless offset by resource rents or state guarantees; tourism and services are especially sensitive to perceived insecurity; logistics networks become more redundant and therefore more costly; and public spending is reallocated toward security at the expense of infrastructure and social investment. In highly connected economies, localized violence can produce non-local effects by disrupting corridors and altering the expected reliability of supply chains. The result is a form of endogenous fragmentation: economic actors respond to insecurity by reducing exposure, which can weaken local economies and thereby expand the conditions under which non-state actors can recruit and extract rents. These dynamics also clarify why “tracking” non-state actors is not merely an intelligence exercise. It is part of geoeconomic governance: states and firms seek to stabilize corridors, maintain credible commitments, and preserve the predictability required for trade, investment, and development. Event datasets and systematic monitoring contribute by making these vulnerabilities legible and by supporting the evaluation of interventions, but they do not substitute for political settlement and institutional legitimacy, which remain the central determinants of long-run stability. ## Conclusion Terrorism and insurgencies should be analyzed as forms of strategic violence that exploit economic connectivity, institutional weaknesses, and corridor vulnerabilities. Empirical monitoring—through event datasets and systematic measurement—helps document where violence concentrates, how it evolves, and which structural conditions correlate with persistence. Yet the core interpretive task for geoeconomics remains to connect these patterns to mechanisms: the pricing of risk, the restructuring of trade and investment, and the governance choices through which states and firms attempt to preserve resilience under insecurity. In a fragmented global landscape, non-state violence is therefore not only a security threat; it is a driver of economic reconfiguration and an enduring constraint on globalization’s institutional foundations.