Your analysis seems to assume that people will remain more afraid of being "outcompeted" than of being murdered, even after a campaign of terrorism that would make 9/11 look minor.
>it often also creates new [problems], often surprising ones
Let's reframe this to remove the negative bias: murder has the obvious direct first-order effect of removing the target from existence, but also a host of non-obvious higher-order effects resulting from people's response to that violence. These can be counterproductive to the goals of the murderer, but they can also work in favor of it. That is why "terrorism" is a real thing - the higher-order effects are essentially a force multiplier, and if you have nothing to lose then the calculus of causing a major disruption begins to look favorable; any disruption, because regression to the mean is good if you're at the shitty end of the bell curve.