John Robb thinks so.
Liz Alderman at the NYTimes reported that terrorism is squashing Europe's first glimmer of recovery since the financial crash. EU economic growth has been halved since spring, with France now at zero. Here are some details:
- Tourism is sinking. For example: "In France, growth in nightly hotel room bookings after the Paris attacks fell to single digits from 20 percent. After the Brussels bombings, bookings went negative, and after Nice, bookings fell by double digits."
- Daily security costs are spiking. Here's an example from a single venue, "the Paris Plage, a makeshift beach erected along the Seine, a dozen armed police officers guarded an entry checkpoint on a recent day. Army troops marched past families playing in the sand and half-empty activity points along the river. The patrols, cost taxpayers about 1 million euros, or $1.1 million, a day."
- Broad spectrum economic damage. For example: retail sales are slumping due to low traffic in stores and large numbers of entertainment events are being cancelled.
Although Europe has suffered terrorism before, this time it's different. Instead of big and relatively infrequent terrorist attacks, these new attacks are small, numerous and geographically dispersed. This change is a big deal, because it makes it possible for terrorists to turn attacks into "a tax" that depresses economic activity by imposing new costs and changing economic behavior.
There's more at the link. Interesting reading.
It's a two-edged sword, of course. Terrorism hits things like tourism, retail shopping centers, and so on. On the other hand, security expenditures increase, and even ordinary consumers will spend more on protecting themselves and their families (and, of course, their homes and possessions). As evidence of that, witness the surge in firearms sales after every major terrorist attack or urban unrest (e.g. after the Pulse nightclub attack in Florida, the riots in Charlotte, etc.) Also, people who might be afraid to vacation in major centers (which are more likely to be the focus of terrorists, due to their high public profile) may bring unexpectedly brisk business to less fashionable (but safer) areas that they otherwise might not have patronized.
Nevertheless, terrorism does drag down the areas where it occurs. If attack follows attack, with no time for those areas to recover, it can have a very negative long-term effect.