"the only sane response to terror is simply to carry on" .... and that applies regardless. Living in a cave is not an option... at least not for me.
.... and as usual, this month and next, I will be in NYC, DC, London, and Delhi (amongst other places) that have been hit by terrorism (often repeatedly). Behaving like scared children and hiding under the bed -- or behaving like a scared adult and aiming a gun at anything that moves -- is not my recommended response.
Two professors, one from the Univ. of Chicago and one from Tel Aviv University, have a quite good paper on this matter of fearful responses to terrorism:
http://www.ilr.cornell.edu/internati...steinPaper.pdf
Per the above, they looked at: (a) the effect of September 11th on the demand for air flight and on pilots’ monetary compensation, (b) the effect of suicide bomber attacks carried out on buses on the demand for bus services and the monetary compensation for bus drivers in Israel, and (c) the effect of suicide bomber attacks on the labor markets outcomes in the market for security guards in Israel.
As The Economist put it when reporting on Becker and Rubinstein's work: "it is not the risk of physical harm that moves people; it is the emotional disquiet. People respond to fear, not risk."
It is no surprise that animals, like people, generally react to fear. But human beings, unlike animals, have the ability to willfully examine risk and react to risk instead of merely reacting to fear. However, according to the above -- and according to what is anecdotally witnessed even on FT -- it appears that counting on most all people to react to risk instead of emotional disquiet (from irrational fear) is expecting too much.