Abstract
This paper develops a bottom-up approach that focuses on behavioral responses in estimating the total economic impacts of the September 11, 2001, World Trade Center (WTC) attacks. The estimation includes several new features. First, is the collection of data on the relocation of firms displaced by the attack, the major source of resilience in muting the direct impacts of the event. Second, is a new estimate of the major source of impacts off-site - the ensuing decline of air travel and related tourism in the U.S. due to the social amplification of the fear of terrorism. Third, the estimation is performed for the first time using Computable General Equilibrium (CGE) analysis, including a new approach to reflecting the direct effects of external shocks. This modeling framework has many advantages in this application, such as the ability to include behavioral responses of individual businesses and households, to incorporate features of inherent and adaptive resilience at the level of the individual decision maker and the market, and to gauge quantity and price interaction effects across sectors of the regional and national economies. We find that the total business interruption losses from the WTC attacks on the U.S. economy were only slightly over $100 billion, or less than 1.0% of Gross Domestic Product. The impacts were only a loss of $14 billion of Gross Regional Product for the New York Metropolitan Area.
| Original language | English (US) |
|---|---|
| Article number | 4 |
| Journal | Peace Economics, Peace Science and Public Policy |
| Volume | 15 |
| Issue number | 2 |
| DOIs | |
| State | Published - Sep 28 2009 |
Fingerprint
Keywords
- Computable general equilibrium analysis
- Economic consequence analysis
- September 11
- Terrorist attacks
ASJC Scopus subject areas
- Sociology and Political Science
- Economics and Econometrics
- Political Science and International Relations
- Management, Monitoring, Policy and Law
Cite this
The economic impacts of the september 11 terrorist attacks : A computable general equilibrium analysis. / Rose, Adam Z.; Oladosu, Gbadebo; Lee, Bumsoo; Asay, Garrett Beeler.
In: Peace Economics, Peace Science and Public Policy, Vol. 15, No. 2, 4, 28.09.2009.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - The economic impacts of the september 11 terrorist attacks
T2 - A computable general equilibrium analysis
AU - Rose, Adam Z.
AU - Oladosu, Gbadebo
AU - Lee, Bumsoo
AU - Asay, Garrett Beeler
PY - 2009/9/28
Y1 - 2009/9/28
N2 - This paper develops a bottom-up approach that focuses on behavioral responses in estimating the total economic impacts of the September 11, 2001, World Trade Center (WTC) attacks. The estimation includes several new features. First, is the collection of data on the relocation of firms displaced by the attack, the major source of resilience in muting the direct impacts of the event. Second, is a new estimate of the major source of impacts off-site - the ensuing decline of air travel and related tourism in the U.S. due to the social amplification of the fear of terrorism. Third, the estimation is performed for the first time using Computable General Equilibrium (CGE) analysis, including a new approach to reflecting the direct effects of external shocks. This modeling framework has many advantages in this application, such as the ability to include behavioral responses of individual businesses and households, to incorporate features of inherent and adaptive resilience at the level of the individual decision maker and the market, and to gauge quantity and price interaction effects across sectors of the regional and national economies. We find that the total business interruption losses from the WTC attacks on the U.S. economy were only slightly over $100 billion, or less than 1.0% of Gross Domestic Product. The impacts were only a loss of $14 billion of Gross Regional Product for the New York Metropolitan Area.
AB - This paper develops a bottom-up approach that focuses on behavioral responses in estimating the total economic impacts of the September 11, 2001, World Trade Center (WTC) attacks. The estimation includes several new features. First, is the collection of data on the relocation of firms displaced by the attack, the major source of resilience in muting the direct impacts of the event. Second, is a new estimate of the major source of impacts off-site - the ensuing decline of air travel and related tourism in the U.S. due to the social amplification of the fear of terrorism. Third, the estimation is performed for the first time using Computable General Equilibrium (CGE) analysis, including a new approach to reflecting the direct effects of external shocks. This modeling framework has many advantages in this application, such as the ability to include behavioral responses of individual businesses and households, to incorporate features of inherent and adaptive resilience at the level of the individual decision maker and the market, and to gauge quantity and price interaction effects across sectors of the regional and national economies. We find that the total business interruption losses from the WTC attacks on the U.S. economy were only slightly over $100 billion, or less than 1.0% of Gross Domestic Product. The impacts were only a loss of $14 billion of Gross Regional Product for the New York Metropolitan Area.
KW - Computable general equilibrium analysis
KW - Economic consequence analysis
KW - September 11
KW - Terrorist attacks
UR - http://www.scopus.com/inward/record.url?scp=70349337149&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=70349337149&partnerID=8YFLogxK
U2 - 10.2202/1554-8597.1161
DO - 10.2202/1554-8597.1161
M3 - Article
AN - SCOPUS:70349337149
VL - 15
JO - Peace Economics, Peace Science and Public Policy
JF - Peace Economics, Peace Science and Public Policy
SN - 1079-2457
IS - 2
M1 - 4
ER -