The effect of terrorism on FDI Looking at Europe in the period of 2012 to 2017

In this paper, the effect of terrorism on FDI is investigated using European panel data for the period of 2012 to 2017. Using several methods and extensions, general terrorism, as well as domestic and transnational terrorism are investigated. Mixed results are found for the different methods. The negative effect of terrorism, when the number of injured people is used as a proxy, seems to be significant on both FDI value and FDI projects. However, the negative effect of transnational terrorism is only found to be significant when FDI value is used as the dependent variable. When the paper zooms in on four single big-impact attacks, no significant results are found.