The Ripple Effects of Terrorism on Country Policy and Institutional Assessments in Pakistan: A Study Using Cross-Country Panel Data
Keywords:
Terrorism, Country Policy and Institutional Assessments (CPIA), Generalized Method of Moments (GMM)Abstract
Country Policy And Institutional Assessments (CPIA) is an important indicator of development. Terrorism in all forms impacts countries, especially the developing. CPIA as one of the prominent aspects is greatly affected by terrorism. This study examines how terrorism affects developing nations' Country Policy and Institutional Assessments (CPIA) from 2011 to 2022. The CPIA components, such as economic management, structural policies, social inclusion, and public management and reforms, are employed in panel data analysis using the Generalized Method of Moments (GMM). Specific data (2011-2022) from the World Bank Data Bank on Country Policy and Institutional Assessments is used to calculate the results. The study found that terrorism dampens fiscal policy, revenue, and financial sector policies, but strict business regulation can mitigate its effects. The research suggests that the negative consequences are long-lasting and influence public sector management and trade policies, requiring innovative policy interventions to enhance resilience. It employs how terrorism affects specific policy sectors and the role of good governance in controlling terrorism-related risks to achieve stability and growth. The study suggests governments should design a more integrated approach to enhance fiscal capacity, improve regulation, and safeguard trade channels to mitigate terrorism.
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