In this paper, we theorize about the role of markets in the war on terror. We contend that as markets straddle the state and society, owing to their inherently political nature, they can play a key role in impacting the war on terror. Drawing on Ronald Coase’s conception of markets as both markets for goods and services, and as markets for ideas, we theorize how these two types of markets impact terrorist mobilization. First, in the markets for ideas, some ideas may facilitate terrorist mobilization, but others may deter it. The nature of economic incentives in these markets will determine which of these ideas prevail. Second, in the markets for goods and services, the power of economic persuasion can attract vulnerable youth away from terrorist mobilization and into more productive economic activities, but ideas sympathetic to terrorist mobilization may corrupt these markets and redirect economic resources towards terrorist mobilization. Finally, terrorist mobilization will also be shaped by the nature of opportunities in the arenas (such as schools and colleges) in which both these markets interact. An examination of the frequency of terrorist incidents in the state of Jammu and Kashmir in India lends credence to our theory.
Rajiv Kozhikode is an Associate Professor of Management and Organization Studies at the Beedie School of Business at Simon Fraser University. His primary research interest is in understanding how markets, states and civil society interact to shape a variety of organizational choices. In a series of papers published in Academy of Management Journal, Organization Science, and Organizational Dynamics, among others, he has examined how firms maneuver pluralism in the political arena, the relationships between social movements’ access over the polity and entrepreneurial opportunities in the market, and how status dynamics in markets push organizations towards misconduct and other forms of risk taking. Recently, I have been studying the sociological foundations of market emergence in unusual places – war zones, refugee camps and aboriginal communities.