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Conflict, defense spending, and the number of nations

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  • Alesina, Alberto
  • Spolaore, Enrico

Abstract

This paper provides a formal model of endogenous border formation and choice of defense spending in a world with international conflict. We examine both the case of democratic governments and of dictatorships. The model is consistent with three observations. First, breakup of countries should follow a reduction in the likelihood of international conflicts. Second, the number of regional conflicts between smaller countries may increase as a result of the breakup of larger countries. Third, the size of the peace dividend (the reduction in defense spending in a more peaceful world) is limited by the process of country breakup.

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Bibliographic Info

Article provided by Elsevier in its journal European Economic Review.

Volume (Year): 50 (2006)
Issue (Month): 1 (January)
Pages: 91-120

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Handle: RePEc:eee:eecrev:v:50:y:2006:i:1:p:91-120

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  1. Friedman, David, 1977. "A Theory of the Size and Shape of Nations," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 85(1), pages 59-77, February.
  2. Gregory D. Hess & Athanasios Orphanides, 2001. "War and Democracy," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 109(4), pages 776-810, August.
  3. Garfinkel, M.R., 1992. ""Domestic Politics and International Conflict"," Papers, California Irvine - School of Social Sciences 90-92-30, California Irvine - School of Social Sciences.
  4. Grossman, Herschel I, 1991. "A General Equilibrium Model of Insurrections," American Economic Review, American Economic Association, American Economic Association, vol. 81(4), pages 912-21, September.
  5. Alberto Alesina & Reza Baqir & Caroline Hoxby, 2004. "Political Jurisdictions in Heterogeneous Communities," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 112(2), pages 348-396, April.
  6. Casella, Alessandra & Feinstein, Jonathan, 1991. "Public Goods in Trade: On the Formation of Markets and Political Jurisdictions," CEPR Discussion Papers, C.E.P.R. Discussion Papers 511, C.E.P.R. Discussion Papers.
  7. Enrico Spolaore & Alberto Alesina & Romain Wacziarg, 2000. "Economic Integration and Political Disintegration," American Economic Review, American Economic Association, American Economic Association, vol. 90(5), pages 1276-1296, December.
  8. Alberto Alesina & Enrico Spolaore, 1995. "On the Number and Size of Nations," NBER Working Papers 5050, National Bureau of Economic Research, Inc.
  9. Sachs, Jeffrey & Sala-i-Martin, Xavier, 1992. "Fiscal Federalism and Optimum Currency Areas: Evidence for Europe from the United States," CEPR Discussion Papers, C.E.P.R. Discussion Papers 632, C.E.P.R. Discussion Papers.
  10. Sandler,Todd & Hartley,Keith, 1995. "The Economics of Defense," Cambridge Books, Cambridge University Press, number 9780521447287, 9.
  11. repec:hrv:faseco:4553034 is not listed on IDEAS
  12. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 103(1), pages 26-52, February.
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