Since the turn of the century, few issues have shaped political debate and policy-making more than terrorism. As a result, there has been a huge increase in the amount of academic research devoted to investigating the causes and consequences of terrorism. The Cambridge Handbook on the Economics of Terrorism is the first to present a state-of-the art survey of the economics of terrorism. It adopts a rational-choice perspective according to which terrorists are viewed as rational economic actors and presents a framework for analyzing the causes and consequences of terrorism. It explores the causes and consequences of terrorism and shines a light on practical counterterrorism policies and their trade-offs. With contributions from many leading figures in this fast-growing and important field, this book offers an accessible yet comprehensive collection of the economic analysis of terror.