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Counterinsurgency, state repression and other forms of coercion have multiple adverse effects. Although a state’s use of threats and force should deter an opposition group, these measures often stimulate resistance. And although state-led coercion aims to influence an opposition group, coercive practices have social, economic and political consequences for civilians. This dissertation studies the efficacy and effects of coercive policies in the context of the Israel-Palestine conflict. The four composite essays investigate the impact of Israel’s practice of house demolition and construction of a separation barrier on Palestinians’ conflict preferences and use of violence, as well as the broader consequences of these policies for Palestinian communities. Essay I questions the conventional wisdom that the selective targeting of militants can be an effective counterinsurgency strategy. Through a survey of Palestinians, it demonstrates that house demolition can generate opposition to peace when it is perceived as indiscriminate in its targeting, even if it is selective by design. Essay II distinguishes between the mechanisms of collective threat and personal fear in state repression. In a longitudinal study of administrative demolition orders, it finds that orders issued against communal structures increase preferences for violence and militant political parties, suggesting that collective threats backfire. Essay III quantifies the economic consequences of counterinsurgency by measuring the separation barrier’s impact on Palestinian employment and wages. It further shows that this economic impact increases the rate of Israeli conflict fatalities, demonstrating that economic consequences of coercion can stimulate violent resistance. Essay IV conceptualises a state’s separation and exclusion of particular population groups as a general phenomenon and form of state repression. It draws on historical cases worldwide and presents the enclosure of Palestinian communities in special zones of the separation barrier as a contemporary example. The essays are empirical studies which use survey methods, quantitative analysis, principles of experimental design, qualitative sources and field work as a basis for description and explanation. As a whole, the dissertation contributes to the study of coercion by calling attention to understudied forms of coercion and identifying particular mechanisms by which threats and force can result in adverse effects.