Rally post-terrorism

This study examines whether the “rally ’round the flag” phenomenon is present after terror-
ist attacks, and investigates explanations for this increase in confidence in national political
institutions and approval of the country leader’s job performance. I exploit variations in
terrorist occurrences and results (success or failure) across subnational EU regions where at
least one attack took place during the data period. I show empirically that both terrorist
occurrences and results are plausibly exogenous to the prior political and economic climate.
Conducting a difference-in-differences analysis, I compare changes in political confidence
and approval among individuals who were exposed to an attack in their region with those
who were not. Utilizing another more sophisticated identification, I also compare such
political changes after successful attacks with those after failed attacks. I find that post-
terrorism, individual political confidence and support significantly increased by more than
10 percentage points, and that this political increment was over 5 percentage points after
successful attacks relative to failed ones. Such rally effects were temporary and faded away
within a year. Furthermore, I explore various potential channels suggesting patriotism and
civic engagement as mechanisms while rejecting perceived economic capture and political
acquisition as alternative explanations.