Geographic profiling of lone wolf terrorists: the application of economics, game theory and prospect theory

Paper


Phillips, Peter J.. 2014. "Geographic profiling of lone wolf terrorists: the application of economics, game theory and prospect theory." Workshop on Strategic Aspects of Terrorism, Security, and Espionage (2014). Stony Brook, United States 16 - 19 Jul 2014
Paper/Presentation Title

Geographic profiling of lone wolf terrorists: the application of economics, game theory and prospect theory

Presentation TypePaper
Authors
AuthorPhillips, Peter J.
Number of Pages19
Year2014
Conference/EventWorkshop on Strategic Aspects of Terrorism, Security, and Espionage (2014)
Event Details
Workshop on Strategic Aspects of Terrorism, Security, and Espionage (2014)
Event Date
16 to end of 19 Jul 2014
Event Location
Stony Brook, United States
Event Venue
State University of New York
Abstract

This paper presents an economic analysis of the choices made by lone wolf terrorists. Using RAND-MIPT data about the fatalities that are inflicted by different attack methods, the paper develops an analysis on a foundation of orthodox utility theory and Markowitz-Tobin approximations. This approach permits a computable opportunity set within a risk-reward or mean-variance framework. Optimal choices can be determined using the Markowitz quadratic programming technique. The framework may provide a useful foundation for an economic perspective on ‘offender profiling’ applied within a terrorism context. Mapping attack methods into mean-variance space provides a more definitive categorisation of the riskiness of attack methods from the terrorist’s perspective and suggests the possibility of identifying the terrorist’s revealed risk preference. Inferences about the unknown offender may be drawn that complement other aspects of the investigative process. One of the key challenges of law enforcement is drawing inferences about the offender’s location and the location of potential targets. Superimposing a game theoretical payoff matrix over a geographic location where payoffs are partially informed by the terrorist’s choices and risk preference may contribute another, economic, perspective to this part of the law enforcement process. Prospect theory may also contribute useful insights into the geographical profiling problem.

Keywordslone wolf, risk-reward, optimal choice, risk preference, law enforcement, offender profiling, geographic profiling, game theory, payoff matrix, prospect theory
ANZSRC Field of Research 2020440211. Police administration, procedures and practice
380199. Applied economics not elsewhere classified
440804. Defence studies
Public Notes

This paper was prepared for the Workshop on Strategic Aspects of Terrorism, Security, and Espionage, held at SUNY Stony Brook, New York. This was an invited paper presented on July 17 2014 before an international gathering of terrorism and security experts.

Byline AffiliationsSchool of Accounting, Economics and Finance
Institution of OriginUniversity of Southern Queensland
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