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An economic approach to analyzing civil wars

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  • Stergios Skaperdas

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Abstract

Civil wars and conflict can be understood from an economic point of view only if there is incomplete contracting. I examine such settings and first discuss sources of incomplete contracting, from geography and ethnic and social distance to external interventions due to geopolitics or the presence of rents. Yet, since war is destructive, the contending parties might normally be expected to settle in the shadow of war. One reason that sometimes they do not, contrary to conventional wisdom, is because the shadow of the future is too long. Subsequently, using a formal model for guidance I examine some consequences of civil wars and emphasize the role hierarchical organization and rents play in determining the severity of conflict.

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File URL: http://hdl.handle.net/10.1007/s10101-007-0043-2
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Bibliographic Info

Article provided by Springer in its journal Economics of Governance.

Volume (Year): 9 (2008)
Issue (Month): 1 (January)
Pages: 25-44

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Handle: RePEc:spr:ecogov:v:9:y:2008:i:1:p:25-44

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Related research

Keywords: Warlords; Incomplete contracting; Conflict; Appropriation; Anarchy; Shadow of the future; D74; F5; H56; O40;

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References

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  1. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 26-52, February.
  2. Stergios Skaperdas, 2001. "The political economy of organized crime: providing protection when the state does not," Economics of Governance, Springer, vol. 2(3), pages 173-202, November.
  3. Konrad, Kai A. & Skaperdas, Stergios, 2012. "The market for protection and the origin of the state," Munich Reprints in Economics 13961, University of Munich, Department of Economics.
  4. Santiago Sanchez-Pages, 2004. "Conflict as a Part of the Bargaining Process: Theory and Empirical Evidence," ESE Discussion Papers 129, Edinburgh School of Economics, University of Edinburgh.
  5. Mehlum, Halvor & Moene, Karl & Torvik, Ragnar, 2003. "Predator or prey?: Parasitic enterprises in economic development," European Economic Review, Elsevier, vol. 47(2), pages 275-294, April.
  6. Oliver Hart & Sanford Grossman, 1985. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Working papers 372, Massachusetts Institute of Technology (MIT), Department of Economics.
  7. Timur Kuran, 1989. "Sparks and prairie fires: A theory of unanticipated political revolution," Public Choice, Springer, vol. 61(1), pages 41-74, April.
  8. Daron Acemoglu & James A. Robinson, 2000. "Why Did The West Extend The Franchise? Democracy, Inequality, And Growth In Historical Perspective," The Quarterly Journal of Economics, MIT Press, vol. 115(4), pages 1167-1199, November.
  9. Paul Collier & Anke Hoeffler, 2004. "Greed and Grievance in Civil War," Development and Comp Systems 0409007, EconWPA.
  10. Michael McBride & Stergios Skaperdas, 2005. "Explaining Conflict in Low-Income Countries: Incomplete Contracting in the Shadow of the Future," CESifo Working Paper Series 1636, CESifo Group Munich.
  11. Michelle R. Garfinkel & Stergios Skaperdas, 2006. "Economics of Conflict: An Overview," Working Papers 050623, University of California-Irvine, Department of Economics, revised Sep 2006.
  12. Wintrobe,Ronald, 2000. "The Political Economy of Dictatorship," Cambridge Books, Cambridge University Press, number 9780521794497.
  13. Anbarci, N. & Skaperdas, S. & Syropoulos, C., 2000. "Comparing Bargaining Solutions in the Shadow of Conflict: How Norms Against Threats Can Have Real Effects," Papers 00-01-19, California Irvine - School of Social Sciences.
  14. Gregory D. Hess, 2003. "The Economic Welfare Cost of Conflict: An Empirical Assessment," CESifo Working Paper Series 852, CESifo Group Munich.
  15. Genicot, C. & Skaperdas, S., 2000. "Investing in Confict Management," Papers 00-01-17, California Irvine - School of Social Sciences.
  16. Skaperdas, Stergios, 1992. "Cooperation, Conflict, and Power in the Absence of Property Rights," American Economic Review, American Economic Association, vol. 82(4), pages 720-39, September.
  17. Fearon, James D., 1995. "Rationalist explanations for war," International Organization, Cambridge University Press, vol. 49(03), pages 379-414, June.
  18. Francisco M. Gonzalez, 2005. "Insecure Property and Technological Backwardness," Economic Journal, Royal Economic Society, vol. 115(505), pages 703-721, 07.
  19. Helmut Bester & Karl Wärneryd, 2006. "Conflict and the Social Contract," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(2), pages 231-249, 07.
  20. Dimitriy Gershenson & Herschel I. Grossman, 1999. "Civil Conflict: Ended Or Never Ending?," Working Papers 99-31, Brown University, Department of Economics.
  21. Skaperdas, Stergios & Syropoulos, Constantinos, 1996. "Can the shadow of the future harm cooperation?," Journal of Economic Behavior & Organization, Elsevier, vol. 29(3), pages 355-372, May.
  22. Michelle R. Garfinkel, 2003. "On the Stability of Group Formation: Managing the Conflict Within," Public Economics 0312005, EconWPA, revised 04 Mar 2004.
  23. Garfinkel, M.R. & Skaperdas, S., 2000. "Conflict without Misperceptions or Incomplete Information: how the Future Matters," Papers 99-00-11, California Irvine - School of Social Sciences.
  24. Joan Esteban & Debraj Ray, 2008. "On the Salience of Ethnic Conflict," American Economic Review, American Economic Association, vol. 98(5), pages 2185-2202, December.
  25. Acemoglu, Daron & Johnson, Simon & Robinson, James A, 2004. "Institutions as the Fundamental Cause of Long-Run Growth," CEPR Discussion Papers 4458, C.E.P.R. Discussion Papers.
  26. Neary, Hugh M, 1997. "Equilibrium Structure in an Economic Model of Conflict," Economic Inquiry, Western Economic Association International, vol. 35(3), pages 480-94, July.
  27. Chwe, Michael Suk-Young, 2000. "Communication and Coordination in Social Networks," Review of Economic Studies, Wiley Blackwell, vol. 67(1), pages 1-16, January.
  28. Grossman, Herschel I, 1991. "A General Equilibrium Model of Insurrections," American Economic Review, American Economic Association, vol. 81(4), pages 912-21, September.
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Citations

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Cited by:
  1. Christopher Blattman & Edward Miguel, 2009. "Civil War: A Review of Fifty Years of Research," Working Papers id:2231, eSocialSciences.
  2. Ahmed Saber Mahmud & Juan F. Vargas, 2008. "Combatant recruitment and the outcome of war," DOCUMENTOS DE TRABAJO 005029, UNIVERSIDAD DEL ROSARIO.
  3. Tridimas, George, 2011. "The political economy of power-sharing," European Journal of Political Economy, Elsevier, vol. 27(2), pages 328-342, June.
  4. Libman, Alexander Mikhailovich, 2009. "Эндогенные Границы И Распределение Власти В Федерациях И Международных Сообществах
    [ENDOGENOUS BOUNDARIES AND DISTRIBUTION O    ," MPRA Paper 16473, University Library of Munich, Germany.
  5. Blattman, Christopher & Miguel, Edward, 2009. "Civil War," Center for International and Development Economics Research, Working Paper Series qt90n356hs, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
  6. Michael McBride & Stergios Skaperdas, 2005. "Explaining Conflict in Low-Income Countries: Incomplete Contracting in the Shadow of the Future," Working Papers 050606, University of California-Irvine, Department of Economics.

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