Public Choice (2013) 156:125–137DOI 10.1007/s11127-012-0008-z

Terrorist success in hostage-taking missions: 1978–2010

Charlinda Santifort · Todd Sandler

Received: 29 February 2012 / Accepted: 3 July 2012 / Published online: 25 July 2012© Springer Science+Business Media, LLC 2012

Abstract This article investigates the determinants of logistical and negotiation successesin hostage-taking incidents using an expanded dataset that runs from 1978 to 2010. Un-like an earlier study, the current study has a rich set of negotiation variables in addition topolitical, geographical, and organizational variables associated with the perpetrators or tar-gets of the attacks. The 33 years of data permit a split into two subperiods: 1978–1987 and1988–2010, before and after the rise of religious fundamentalist terrorist groups. Logisti-cal success depends on resource and target vulnerability proxies, while negotiation successhinges on bargaining variables. Among many novel findings, democracy significantly ham-pers logistical success throughout the entire period. Kidnappings, tropical climates, and highelevations foster logistical success. Religious fundamentalist terrorists’ logistical advantageduring 1978–1987 was lost during 1988–2010. Abducting protected persons, making de-mands on the host country, and staging incidents in a democracy limit negotiation successfor the terrorists. If terrorists moderate or replace one or more demands, the likelihood ofnegotiation success for the terrorists goes up.

Keywords Hostage-taking · Logistical success · Negotiation success · Logit regressions ·Democracy · Religious fundamentalists

JEL Classification C25 · D74 · H56

1 Introduction

From the initiation of the modern era of transnational terrorism, hostage-taking missionshave been some of the most highly visible and policy-influential of terrorist events. Hostage-taking incidents come in four varieties: kidnappings, skyjackings, barricade missions, and

C. Santifort · T. Sandler (�)Department of Economics, School of Economic, Political & Policy Sciences,University of Texas at Dallas, 800 W. Campbell Road, Richardson, TX 75080, USAe-mail: tsandler@utdallas.edu

C. Santiforte-mail: csantifort@gmail.com

126 Public Choice (2013) 156:125–137

the takeover of ground-based modes of transportation (e.g., ships, trains, and buses). Kid-nappings differ from the three other kinds of hostage incidents because the hostages andtheir abductors are in—or can quickly move to—unknown locations. Hidden locations makekidnappings less risky, which then explains why well over half of all transnational hostage-taking events are of that type (Enders and Sandler 2012). Hostage taking varies considerablyover time, rising as a percentage of transnational terrorist incidents following successfulmissions and falling after failed missions (Brandt and Sandler 2009).

The primary purpose of the article is to reexamine the determinants of logistical andnegotiation successes for transnational terrorist hostage incidents between 1978 and 2010.A hostage mission is deemed to be a logistical success if the terrorists capture and secureone or more of their intended victims. Hostage-taking terrorists succeed in their negotiationswhen granted some, but not necessarily all, of their demands.

This article differs in a number of crucial ways from an earlier one by Gaibulloev andSandler (2009). First, the current investigation includes important control variables relat-ing to political, geographical, and organizational characteristics of the perpetrators and tar-gets of hostage-taking incidents, which were not included in the previous article. Second,the current study contains a richer set of negotiation variables that generates some novelfindings. Third, we investigate whether or not hostage-taking behavior differs since 1988,when religious fundamentalists began to dominate transnational terrorist activities (Endersand Sandler 2000; Hoffman 2006). In fact, as we shall see below, hostage-taking incidentschanged significantly in the 1988–2010 period. Fourth, we examine the overall influenceson successfully resolving through negotiation the hostage-takers’ demands.

This study shows that logistical success depends positively on the resources terroristsallocate to hostage-taking incidents. Moreover, logistical success increases when potentialtargets are more vulnerable (e.g., kidnapping victims and large hostage grabs). Geographicalfactors, tropical climates, and mountainous terrain foster logistical success, while democracyhinders it. When we include a rich set of negotiation variables, a statistical test indicates thatthere is no reason to report separate estimates for kidnappings and other kinds of hostage-taking incidents. Relative to these other hostage-taking events, kidnappings, which usuallyinvolve a single hostage, reduce the likelihood of a successful negotiation. We also findthat negotiation is more likely to be successful for the terrorists when the government’sdisagreement value is lower (e.g., when more hostages are taken) or the terrorists’ relativebargaining position is stronger (e.g., when more demands are on the table and the hostagetakers can engage in tradeoffs among them).

2 Preliminaries

In the current paper, we are interested in transnational terrorist hostage-taking missions dur-ing 1978–2010. We focus on this period owing to the availability of hostage data from In-ternational Terrorism: Attributes of Terrorist Events (ITERATE) that include logistical andnegotiation variables, which recently were extended to 2010 (Mickolus et al. 2011).

There are at least three distinct stages to any hostage-taking operation. In the first stage,the mission is mapped out and resources are assigned to it. If the authorities stop the missionduring this planning stage, the thwarted incident is recorded as a logistical failure. Thisoccurs in 2.5 % of all hostage-taking missions over the full sample period. The next stageis the execution stage in which the terrorists go to the designated scene (e.g., an airport fora hijacking or a street corner for a kidnapping) to carry out the abduction. If the terroristscomplete the mission and capture at least one hostage, the attack is categorized as a logistical

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success. For our analysis, we combine the planning and execution stages. A terrorist groupmust be logistically successful in order to reach the final bargaining stage, at which pointthe terrorists negotiate with the authorities or private interests over a set of demands. Thedemands may be for money to ransom the hostage(s), for the release of jailed colleagues, forthe publication of a propaganda statement, or for safe passage to a terrorist haven. Becausenegotiation success is conditioned on logistical success, the conditional negotiation successrate must necessarily be smaller than the likelihood of logistical success. This of course doesnot imply that the chance of a successful negotiation, once hostages have been abducted, isless than that of logistical success. Recognizing that a terrorist group may inflate its demandsat the outset of negotiations, it succeeds at this stage if some of the demands are granted.

3 Theoretical considerations

Following Gaibulloev and Sandler (2009), the terrorist group is viewed as allocating itsresources among alternative hostage-taking opportunities so as to maximize its expectedbenefits, subject to a resource constraint.1 The likelihood of logistical success in hostageincident i is positively related to the resources allocated to the mission and to the target’svulnerability. Vulnerability increases in unprotected venues, such as street corners or privatemotor vehicles, but decreases with the existence of technological barriers, bodyguards, andother countermeasures. If vulnerabilities to hostage incidents of type i decline, terroristsrationally will engage in fewer incidents of that type, transferring their resources to otherkinds of incidents. Comparative statics show that an increase in the resources available toterrorist groups potentially would raise the number of hostage incidents of all types, whileraising the expected payoff to a type-i hostage mission would lead to more incidents of thattype only. Moreover, if the payoff to a particular mission is large enough, terrorists maypursue a hostage-taking opportunity even if the probability of logistical success is modest.

Terrorists may bolster their prospects of logistical success by increasing the size of theattack force, by augmenting its firepower, or both, i.e., combining high-powered weapons(e.g., automatic weapons or explosives) with a large hostage-taking group. Additions to theattack force’s manpower or additions to its firepower represent decisions to allocate moreresources to the incident. A larger attack force assists the group in capturing and securingits hostages by providing lookouts, diverting the authorities’ attention away from the siteof the abduction, and helping overcome physical obstacles, while high-powered weaponsallow the attack force to keep would-be interveners at bay.

The mix of operatives in the attack force is another essential resource choice. If multiplenationalities compromise the group’s ability to plan and coordinate a mission, owing, forexample, to language barriers or cultural differences, the resources allocated to the incidentwill be less effective, which reduces the probability of logistical success. In an importantpaper, Benmelech and Berrebi (2007) showed that the human capital mix of terrorists is acrucial determinant of logistical success in suicide attacks. Unfortunately, ITERATE doesnot record the human capital of the hostage takers, so that we cannot take advantage of thisvariable. Terrorist casualties suffered during the execution stage also represent reductionsin resources that make logistical success less likely. Since ITERATE does not record thetime(s) at which a terrorist group sustains casualties, if any (immediately before, during, or

1The underlying model is a modification of an analysis in Berrebi and Lakdawalla (2007). See Gaibulloevand Sandler (2009) for modeling details.

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in the get-away phase of a hostage-taking incident), we assume that terrorist casualties occurat the event’s outset.

Target vulnerability can be related to a number of observed variables. Highly defendedtargets, such as protected persons and fortified buildings (e.g., embassies), inhibit logisticalsuccess because security makes the seizure of hostages more difficult. Relative to other typesof hostage incidents, kidnapping victims offer more vulnerable targets, because the terroristscan pick the place and time of the abduction. By effectively promoting the protection ofpeople and property, liberal democracies can lessen target vulnerability. On the other hand,open societies afford greater freedom of movement to terrorist groups than do police states,thereby making the targets of hostage-taking missions more vulnerable to attack. Targetsmay seem to be more vulnerable in incidents involving the grabbing and holding of largenumbers of hostages since only one of them must be secured for the event to be recorded as alogistical success. In addition, with more lives at risk police may be less willing to interveneat the outset of a hostage incident, thereby contributing to a successful operation.

Countries with tropical climates or high elevations may enhance the vulnerabilities of po-tential hostage targets, and hence make logistical success more likely. This follows becauseterrorist groups located in tropical or mountainous countries can train and take refuge in se-cluded venues. Additionally, hostages can be captured more easily in isolated locales (e.g.,scenic lookouts) where there is little security. The operations of Islamist terrorist groups mayhave been associated with greater target vulnerability during 1978–1987, since such groupsflew under the radar then. However, once such groups rose to prominence in the 1990s, theirintended hostages were probably less vulnerable as the authorities monitored the action ofsuch groups more closely.

Once one or more hostages are secured, the incident enters the negotiation stage. Someof the factors that determine negotiation success are apt to differ from those that influencelogistical success. Negotiation success hinges on considerations from Nash bargaining the-ory, where two parties—say, the government and the terrorists—negotiate over something,such as the lives of the captured hostages in exchange for concessions to the terrorist group’sdemands. The outcome of the negotiations depends on two key considerations: the disagree-ment values and the relative bargaining strengths of the adversaries (Dixit and Skeath 2009;Gaibulloev and Sandler 2009). The disagreement values are what the parties walk away within the absence of an agreement (i.e., their outside options). A larger disagreement value fa-vors one party or the other, since it has less to lose from a failed negotiation. The morepatient of the adversaries is in a stronger bargaining position. Relative bargaining strengthsalso depend, in part, on the outcome of the first (combined planning and execution) stageof a hostage-taking mission. If, for example, the terrorists sustain casualties, they may wantto end the negotiations quickly, and thus will be at a bargaining disadvantage. Alternatively,such casualties could harden the group’s position. Hence, there can be opposing priors onnegotiation success.

Kidnappings reduce terrorist negotiation success relative to other hostage-taking inci-dents. This follows because the bargaining strength of the terrorists is not so great when, asin a typical kidnapping, few lives hang in the balance. In other kinds of hostage-taking in-cidents (e.g., skyjackings or barricade events), there are more hostages so that the terroristscan, for example, trade one or more hostages for creature comforts or other considerationsduring the negotiations, thereby giving them more bargaining options and a greater like-lihood of negotiation success. In addition, the disagreement value for the government islarger for kidnappings than for other types of hostage-taking incidents. This occurs, in part,because every terrorist group’s negotiating success in a kidnapping incident results in 2.62more kidnappings, which damages the government’s reputation. Successful negotiations for

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the terrorists in other types of hostage-taking incidents generate few additional missions(Brandt and Sandler 2009). Thus, the government is more inclined to walk away from kid-nappings with no agreement. Terrorist casualties lessen the group’s disagreement value andits bargaining strength, as their colleagues are wounded, perhaps mortally, or killed outright.This implies that such casualties reduce negotiation success.

Capturing protected persons may reduce negotiation success by raising the government’sdisagreement value owing to a no-concessions policy. To concede and renege on this statedpolicy for a captured public official would cause the government to lose credibility in futurehostage-taking incidents (Lapan and Sandler 1988). Since the Irangate scandal during theReagan administration, governments have been under greater pressure not to concede tohostage takers when protected persons are abducted. Nevertheless, some governments maycave into public opinion for some protected persons (e.g., the Israeli government has doneso for captured soldiers), so that there may be opposing influences on our priors.

When terrorists impose demands on the host country where the hostages are captured,this raises the government’s disagreement value, thereby lowering the negotiation successprospects of the terrorists. Democracies also have larger disagreement values than autocra-cies and can walk away from negotiations at lower cost. In nonkidnapping hostage incidents,democracies possess greater bargaining strength owing to their no-concessions pledges. Infact, such pledges are intended to gain for the government a first-mover advantage. Willing-ness on the part of the terrorists to alter their demands or to negotiate over multiple demands(dimensions) increases the size of the negotiation set. A larger bargaining set strengthensthe terrorists’ hands because there are more opportunities for successful deals. If terror-ists reduce some of their demands during the incident, then negotiations are being pursued,which bodes well for an agreement. The presence of a government negotiator may fosternegotiation success for the terrorists, because such a negotiator lowers the government’sdisagreement value, especially in nonkidnapping hostage incidents. This follows becausegovernments may be apt to assign a negotiator when the stakes are higher.

If the hostage takers are religious fundamentalists, then the government’s disagreementvalue rises because caving into such terrorists can have dire political consequences. This isparticularly true given the carnage that Islamists and other fundamentalists have wreaked inpast attacks. Disagreement values for fundamentalist terrorists are likely to be higher thanfor other kinds of terrorists. This follows because fundamentalists get something from theresulting carnage even if the negotiations end in failure. Both of these considerations reducethe prospect for a negotiated settlement.

4 Empirical method and data

We estimate several nonlinear binary-choice models using logit and probit regressions toidentify the determinants of terrorist logistical and negotiation successes in transnationalhostage-taking incidents. Because there is no theoretical rationale for preferring one methodto the other (Greene 2003), we report the logit results in the text (the probit results areavailable upon request and are very similar).

Our data on transnational hostage-taking missions are retrieved from the ITERATE dataset, which records detailed information about terrorism events. We obtain event data fromtwo ITERATE files: the Common file, which contains pertinent details such as date of attack,type of attack, number of victims, and logistical outcome of the mission; and the Hostagefile, which contains incident-specific information, such as the hostage takers’ demands, and

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negotiation variables (e.g., negotiation success and strategies). Recently, ITERATE’s Com-mon file was merged with the Hostage file to provide more extensive details about eachhostage event (Brandt and Sandler 2009).

For negotiation behavior, we use the “terrorist behavior in negotiation” variable, drawnfrom ITERATE Hostage file. We view hostage takers as “changing their demands” if theylessened one or more of them, replaced some demands with others, or intensified some de-mands and moderated others. We assign a value of 1 to changing demands (as just defined),while we assign a value of 0 to no change in demands. We exclude the cases in which theterrorists increased one or more demands without decreasing any other demand, becausethis strategy is bargaining in bad faith, making a negotiated deal for the hostage taker lesslikely. In our sample, hostage takers altered their demands in this manner in 17.4 % of theincidents. Other ITERATE variables—negotiation success, government negotiator, multipledemands, and demands on host country are self-explanatory.

We draw our democracy variable from the Polity IV Project, which scores a country’spolitical system based on indicators of democratic and autocratic governance (Marshall etal. 2010). In keeping with convention, we characterize democracies as having polity scoresof 6 or above, and we characterize nondemocracies as having polity scores below 6. Weassign democracies a dummy value of 1, and we assign nondemocracies a dummy valueof 0. The variables for tropical climates and elevations come from the Geography Datasets(Gallup et al. 2010). In addition, we construct the religious group variable using the terroristgroup dataset developed by Blomberg et al. (2011). A dummy value of 1 is assigned tohostage-taking events in which the credited terrorist organization is religious based. Othertypes of groups—left wing, right wing, and nationalist-separatist—are assigned a 0.

Table 1 presents the summary statistics for the logistical and negotiation success vari-ables. In our sample, 59.6 % of hostage-taking missions were logistically successful, andof those 46.6 % were successful in negotiations. Thus, 27.5 % of sample incidents resultedin negotiation success for the terrorists. On average, just over one nationality was repre-sented in the terrorist attack force. We use the square root of the number of hostages takenbecause the marginal impact on logistical success should be larger in going from one totwo hostages than in going from 20 to 21 hostages. Thus, any positive marginal effect isdiminishing. A host country for a hostage-taking mission had on average 28.9 % of its landarea in a tropical climate. Moreover, the average elevation for host countries was 693.3 me-ters above sea level. Hostage takers placed their demands on the host country in 53.3 % ofsample incidents. Democratic countries, as opposed to nondemocratic ones, hosted 47.5 %of hostage-taking missions and 41.8 % of hostage negotiations. Kidnappings comprised36.6 % of hostage-taking incidents during the execution stage and 47.1 % of those incidentsduring the negotiation stage. Protected persons in all hostage-taking incidents belonged tothe following categories: host or foreign government officials, military personnel, corporateexecutives, or prominent opinion leaders. On average, 21.5 % of negotiations involved a pro-tected person as a hostage. Terrorist casualties occurred in 11.5 % of sample hostage-takingevents.

Hostage-taking terrorists were armed with high-powered weapons in 63.5 % of sampleevents. Interacting high-powered weapons with the number of attack force members cap-tures the complementarity that attack force size (with an average of nine members) and theuse of high-powered weaponry has on logistical success. A government negotiator fromthe host, victim, or foreign country was present in 76.9 % of sample negotiations. Terroristgroups displayed a willingness to negotiate because they bargained over multiple demandsin 49.5 % of negotiations and they changed their demands (as described earlier) in 37.1 %of negotiations. On average, religious terrorist groups conducted just 7.5 % of sample inci-dents. Only 10.9 % of negotiations over hostages involved a religious group.

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Table 1 Summary statistics for success

Variables Observations Mean Std. Deviation

Logistical success

Logistic successa 495 0.596 0.491

Terrorist nationalities 495 1.087 0.415

Number of hostages (sqrt) 416 5.00 4.89

Tropical climate 489 0.289 0.397

Elevation/100c 489 6.933 4.394

Democracya 495 0.475 0.500

Kidnappinga 495 0.366 0.482

Terrorist casualtiesa 495 0.115 0.320

High-powered weapona 310 0.635 0.482

Attack_weaponb 303 4.620 9.065

Religiousa 491 0.075 0.264

Negotiation success

Negotiation successa 416 0.466 0.499

Demands on host countrya 394 0.533 0.500

Democracya 414 0.418 0.494

Kidnappinga 416 0.471 0.500

Protected persona 400 0.215 0.411

Terrorist casualtiesa 416 0.115 0.320

Government negotiatora 294 0.769 0.422

Multiple demandsa 416 0.495 0.501

Changing demandsa 307 0.371 0.484

Religiousa 386 0.109 0.312

aDummy variable equals 1 if the aspect is present and equals 0 otherwise

bInteractive variable of attack force and high-powered weaponcMean Elevation in meters divided by 100 for scale

5 Results

5.1 Logistical success

We begin our investigation of the determinants of logistical success in transnational hostage-taking missions by developing three baseline models. After a series of Likelihood Ratio (LR)tests, we carry forward the best-fitting model.2 To explore changes through time, we separatethe sample into three distinct periods: 1978–2010 (the full sample), 1978–1987 (the earlyperiod), and 1988–2010 (the late period). In so doing, we capture the effect that the rise inreligious fundamentalist terrorist groups has had on transnational hostage-taking missions.Table 2 shows the results of the logit model for logistical success and the estimated marginaleffects for each of the three time periods.

2The results for these alternative models and the LR test results are available upon request. For logisticalsuccess and later for negotiation success, the best-fitting models have the least overlap with the models inGaibulloev and Sandler (2009).

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Table 2 Logistical success logit model estimates and marginal probabilities, 1978–2010

Variables 1978–2010 1978–1987 1988–2010

Coefficients Marginaleffects

Coefficients Marginaleffects

Coefficients Marginaleffects

Constant 0.209 −0.180 2.180*

(0.628) (1.097) (1.246)

Attack_weaponb 0.054* 0.013* 0.072 0.017 0.788*** 0.048***

(0.032) (0.008) (0.053) (0.012) (0.267) (0.017)

High-poweredweapona

−0.491 −0.120 −0.668 −0.159 −1.899*** −0.113**

(0.360) (0.086) (0.623) (0.150) (0.706) (0.057)

Terroristcasualtiesa

−2.439*** −0.503*** −2.798*** −0.433*** −2.829*** −0.421*

(0.558) (0.074) (0.877) (0.082) (1.062) (0.238)

Terroristnationalities

−0.858** −0.212** −1.729** −0.403** −0.989 −0.060

(0.420) (0.104) (0.799) (0.186) (0.837) (0.049)

Kidnappinga 2.101*** 0.446*** 3.278*** 0.674*** 1.146 0.054

(0.485) (0.080) (0.737) (0.101) (1.232) (0.050)

Number ofhostages (sqrt)

0.098*** 0.024*** 0.156*** 0.036*** −0.005 −0.000

(0.036) (0.009) (0.061) (0.014) (0.062) (0.004)

Tropical climate 0.968** 0.239** 1.208* 0.281* 0.019 0.001

(0.478) (0.118) (0.725) (0.167) (0.873) (0.053)

Elevation/100c 0.064* 0.016* 0.009 0.002 0.087 0.005

(0.035) (0.009) (0.070) (0.016) (0.062) (0.005)

Democracya −1.287*** −0.310*** −0.843 −0.194* −1.586*** −0.118

(0.316) (0.071) (0.518) (0.117) (0.558) (0.079)

Religiousa 0.465 0.111 3.266** 0.631*** −4.158*** −0.728***

(0.702) (0.160) (1.387) (0.128) (1.605) (0.226)

Sample size 256 144 112

LR chi-squared 96.63 86.97 42.58

Degrees offreedom

10 10 10

Predictedprobability

0.551 0.369 0.935

a,b,c See Table 1 footnotes. Significance levels: *** is .01, ** is .05, and * is .10. Standard errors are inparentheses

The interaction term (Attack_weapon) between attack force and high-powered weaponshas a positive and significant impact on logistical success over the full sample and in thelate, post-1987 period. The marginal impact of the interactive term yields an increase of 1.3percentage points in logistical success for the overall period and an increase of 4.8 percent-age points in logistical success for the late period, consistent with our priors. The findingswith respect to the interaction term and high-powered weapons suggest strongly that theseweapons are useful only when coupled with a sizeable attack force. The late period boost canbe attributed to advances in weapons’ technology, including enhanced firepower. Consideredon their own, high-powered weapons had a negative and significant impact on logistical suc-cess in the late period, lowering the success rate by 11.3 percentage points. Looking at theraw data, we find that terrorist casualties rose dramatically after 1987 in incidents when the

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hostage takers were equipped with high-powered weapons; however, the logistical successrate remained nearly the same (the difference is less than 2 %), independent of the pres-ence or absence of high-powered weapons. Between 1988 and 2010, the terrorist casualtyrate in the absence of high-powered weapons was 4.3 %. This rate jumped to 20.5 % whenhigh-powered weapons were present, so that the use of such weaponry decreased logisticalsuccess.3

In Table 2, the marginal impact of terrorist casualties on logistical success is negativeand significant in every period: success is reduced by 50.3 percentage points in the over-all period, by 43.3 percentage points in the early period, and by 42.1 percentage points inthe late period. The impact of religious fundamentalist groups emerges in several variables.The number of nationalities represented in a hostage-taking group is detrimental (and sig-nificantly so) to logistical success, supporting our priors. An increase of one nationality inthe terrorist attack force (above its mean value of 1.087) decreases logistical success by21.2 percentage points in the overall period and by 40.3 percentage points in the early pe-riod. That variable is not significant in the late period, presumably because the dominantreligious terrorist groups are extremely homogeneous.

As anticipated, kidnappings are a positive and significant indicator of logistical successin the overall and early periods, wherein at the margin kidnappings bolster logistical successby 44.6 and 67.4 percentage points, respectively, relative to other kinds of hostage-takingincidents. However, kidnappings are not significant in the late period. Religious fundamen-talist groups focus on attack methods that impact a large audience through bloodshed andviolence. Kidnappings do not achieve this goal since they usually involve a single hostagevictim. Thus, religious fundamentalists not only perpetrate fewer kidnappings relative toother terrorist groups, but also they may invest fewer resources in kidnappings, thereby lim-iting their logistical success. This same argument holds true for the number of hostages inthe late period. The (square root of the) number of hostages taken is a positive and significantdeterminant of logistical success, increasing it by 2.4 percentage points in the overall periodand by 3.6 percentage points in the early period. However, the impact of that variable onlogistical success is statistically insignificant in the late, fundamentalist-dominated period.

Logistical success is significantly more likely in mountainous regions and tropical cli-mates, a result that supports our beliefs. At the margin, mountainous regions boost logisticalsuccess by 1.6 percentage points in the overall period; tropical climates increase logisti-cal success by 23.9 percentage points and 28.1 percentage points in the overall and earlyperiods, respectively. These findings support the notion that the ability to conceal their op-erations in jungles or mountainous terrain contributes to hostage takers’ logistical success.Despite some mixed priors, logistical success is significantly less likely (by 31 percent-age points) in democratic countries over the full sample. This finding suggests that liberaldemocracies are better able to protect people from becoming the victims of hostage-takingmissions than nondemocracies. The apparent decline in democracies’ effectiveness with re-spect to limiting terrorists’ logistical success rates in the late period plausibly is due to thedominance of the religious fundamentalist groups, which tend to perpetrate fewer attacks,but with more casualties per event. This finding could also be explained by the larger num-ber of democratic governments in the post-1987 period, along with their greater willingness,unlike autocracies, to report hostage-taking incidents (Sandler 1995). With the spread of the

3The correlation between terrorist casualties and high-powered weapons is minimal. When terrorist casualtiesare excluded from the model, the high-powered weapons variable remains a negative and significant predictorof logistical success, depressing it by 14.6 percentage points.

134 Public Choice (2013) 156:125–137

internet, smart phone, and social media, autocracies lost their ability to hide such eventsfrom the public’s eye in the latter period.4

Finally, the impact of religious groups on logistical success was positive and significantin the early period, but negative and significant in the late period. Prior to 1988, religiousgroups were a relatively new phenomenon and were not watched closely by the authorities;hence, these groups possessed tactical operational advantages. In the early period, logisticalsuccess in hostage-taking incidents was 63.1 percentage points more likely for religiousterror groups than for other types of terrorist organizations. After 1988, as religious groupsrose to prominence, the attention they drew from law enforcement and counterterrorismofficials apparently depressed their chances of logistical success in hostage-taking missionsby 72.8 percentage points

5.2 Negotiation success

The determinants of negotiation success are found in the same manner as those for logisti-cal success. We perform a pooling test to determine if the coefficient estimates for kidnap-pings jointly differ from the coefficient estimates for other types of hostage-taking incidents.Based on a chi-square test statistic, we find that these coefficient estimates do not jointly dif-fer; hence, we pool the samples. We develop three baseline models (available upon request)and carry the best-fitting model forward, based on a series of LR tests. For this best-fittingmodel, Table 3 displays the logit estimates and their marginal probabilities for negotiationsuccess associated with each of the three time periods.

In Table 3, kidnappings have a negative and significant marginal impact on negotiationsuccess in the full sample, leading to a 15.5 percentage point decrease, consistent with ourprior beliefs. With few lives hanging in the balance in a typical kidnapping, terrorists havelow bargaining strength and the government is more willing to walk away from negotiations.Terrorist casualties likewise reduce negotiation success significantly. Casualties reduce suc-cess at the margin by 27.4 percentage points in the overall period and by 38.1 percentagepoints in the early period. Thus, as a terrorist group experiences more wounded or killedcomrades during a hostage incident, they apparently become more willing to end negoti-ations without a gain. Thus, our empirical results do not show that such casualties causehostage takers to harden their negotiating stance.

The abduction of a protected person marginally decreases hostage takers’ success in ne-gotiations by 18.4 percentage points in the overall period and by 34 percentage points inthe late period. However, the indicator for protected persons is not significant in the earlyperiod. This finding suggests that over time governments are becoming less willing to breaktheir no-concessions pledges. Placing demands on the host country marginally diminishesterrorists’ negotiation success in the full sample by 17.4 percentage points, presumably be-cause governments do not want to sully their reputations by conceding to terrorist demandseven when important people are taken hostage. Democracies face an analogous situation.Executing a hostage-taking mission in a democracy marginally lowers negotiation successfor the terrorists by 12.5 percentage points in the overall period. These findings support ourbelief that a no-concessions policy gives the government a first-mover advantage.

Contrary to our priors, the use of a government negotiator is not a significant determinantof negotiation success for the hostage takers. The willingness on the part of the terrorists tomoderate their demands or to trade one off against another (i.e., to change their demands) is

4We thank an anonymous referee for this insight.

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Table 3 Negotiation success logit model estimates and marginal probabilities, 1978–2010

Variables 1978–2010 1978–1987 1988–2010

Coefficients Marginaleffects

Coefficients Marginaleffects

Coefficients Marginaleffects

Constant 0.771 0.983 0.646

(0.512) (0.939) (0.710)

Kidnappinga −0.641* −0.155* −0.675 −0.162 −0.683 −0.140

(0.356) (0.085) (0.620) (0.143) (0.546) (0.114)

Terroristcasualtiesa

−1.223*** −0.274*** −1.943** −0.381*** −0.963* −0.215

(0.450) (0.104) (0.857) (0.111) (0.553) (0.156)

Protected personsa −0.751** −0.184** −0.198 −0.049 −1.478** −0.340**

(0.390) (0.095) (0.544) (0.135) (0.683) (0.161)

Demands on hostcountrya

−0.734** −0.174** −0.392 −0.097 −0.410 −0.083

(0.333) (0.076) (0.571) (0.141) (0.505) (0.095)

Democracya −0.516* −0.125* −0.561 −0.137 −0.756 −0.156

(0.305) (0.076) (0.515) (0.124) (0.484) (0.101)

Governmentnegotiatora

0.508 0.124 −0.474 −0.118 1.038 0.230

(0.411) (0.104) (0.634) (0.157) (0.649) (0.153)

Changing demandsa 0.992*** 0.231*** 0.860* 0.211* 0.775 0.152*

(0.325) (0.072) (0.499) (0.119) (0.497) (0.093)

Multiple demandsa −0.049 −0.012 −0.341 −0.085 0.435 0.086

(0.335) (0.080) (0.563) (0.140) (0.491) (0.095)

Religiousa −0.500 −0.123 0.065 0.016 −0.897 −0.202

(0.514) (0.128) (0.710) (0.176) (0.765) (0.186)

Sample size 209 92 117

LR chi-squared 41.53 13.79 32.26

Degrees of freedom 9 9 9

Predicted probability 0.599 0.442 0.727

a See Table 1 footnotes. Significance levels: *** is .01, ** is .05, and * is .10. Standard errors are in parentheses

a positive and significant determinant of negotiation success; success rates increase by 23.1percentage points in the overall period, by 21.1 percentage points in the early period, and by15.2 percentage points in the late period. The ability to bargain in good faith with authoritiesallows for hostage takers to negotiate more successful deals.

Neither making multiple demands nor hostage taking by religious groups are significantdeterminants of negotiation success. Finally, we note that the full sample provides muchclearer results with respect to our negotiation variables than either of the pre- and post-1987subperiods.

6 Policy conclusions

A number of policy implications can be drawn from this study. Although democracies appearto offer favorable environments for terrorism (Eubank and Weinberg 1994), democracies donot make logistical or negotiation success in hostage-taking incidents more likely. This then

136 Public Choice (2013) 156:125–137

suggests that terrorists will adjust their venues for hostage-taking missions owing to recentlogistical and negotiation failures. The implication is that Westerners will be taken hostage innondemocracies, where there are fewer prior pledges of no concessions. Hence, additionalcounterterror vigilance is needed in nondemocratic countries, requiring that democracies,whose people are most at risk, coordinate with nondemocracies to curb hostage taking. A no-concessions policy appears to be effective when protected persons (including governmentofficials) are abducted or the kidnapping venue is located in a democratic country. This isparticularly true after 1987. The adoption of no-concessions policies by nondemocracies islikely to reduce hostage taking there as well.

The huge increase in homeland security following 9/11 in rich countries has shiftedterrorism to Africa, Asia, and the Middle East (Enders and Sandler 2012). Many of thesecountries have tropical climates or mountainous terrains, which promote terrorist logisticalsuccess in hostage-taking operations. This transfer of venues needs to be addressed throughinternational cooperation.

The greater vigilance accorded to Islamist and other fundamentalist religious terroristsin recent years has curbed their hostage-taking successes and needs to be continued. How-ever, the hostage-taking failures of such groups will mean that they will rely increasingly onterrorist incidents that do not involve the taking of hostages. This realization is again a callfor care on the part of counterterrorist authorities as to how they allocate resources devotedto defensive antiterrorism measures. The ability of the authorities to inflict casualties on theterrorists during a hostage-taking incident limits terrorist success at both the execution andnegotiation stages. If such casualties are observed during a hostage incident, then the au-thorities can be more sure of success if they adopt tougher stances during negotiations. In27.5 % of sample incidents, the terrorists succeeded in achieving some of their demands, anoutcome that creates a transnational externality because it encourages terrorists to take morehostages in the future. Some of these negotiation successes for terrorist groups result fromthe concessions made to kidnappers by businesses and other private parties. Hence, moreneeds to be done from a public policy perspective to limit the concessions granted to terror-ists if hostage taking is to be curbed. Given that demands are made on diverse entities (i.e.,governments, private parties, and businesses) in hostage-taking incidents, global adherenceto a no-concessions policy is a supreme collective action challenge.

Acknowledgements This article has profited from comments by an anonymous referee, William Shughart,and Peter Leeson. This study was funded, in part, by the US Department of Homeland Security (DHS) throughthe Center for Risk and Economic Analysis of Terrorist Events (CREATE) at the University of SouthernCalifornia, Grant 2010-ST-061-RE0001. However any opinions, findings, conclusions, and recommendationsare solely those of the authors and do not necessarily reflect the views of DHS or CREATE.

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