Context

Some say, the link between economics and security is normally assumed, not analyzed. As unequal distribution of income, power, and resources has led to political and economic instability, efforts have been made to encourage economists to explore economic aspects of security. However, the problem one faces in security and economy is the fact that most of the crime and security-related studies have to deal with several “information gaps”. Developing quantifiable methodological issues are difficult and the applied research is limited. Therefore, considering the limitations of the studies in linking economy with most of the crime, terrorism and security aspects, a modest approach has been taken in the paper to review appropriate literatures in linking security and economy includingauthor’s occasional lectures at Army Command and Staff College during last few years.

Overall security measures could reduce the chances of criminal event including the risk of terrorism. The financial cost is so high, poor nations have to find out appropriate measures to reduce the expenditure but maintain security. Available data on the costs of crime is very scary. Unless a practical model for financial management is prepared, it will be extremely difficult for less developed countries. In the Netherlands, for example, in 2005 the estimated costs of crime remained at 20.2 billion euro, which was approximately 4.1 percent of the GDP. The expenditure in 2000, in England and Wales were between £35 and £60 billion per year (http://securipedia.eu/mediawiki/index.php/Economic_effects_of_crime). This gives the glimpse of the relationship between the security and economy.