Resource curse in reverse: The coffee crisis and armed conflict in Colombia
AbstractBetween 1998 and 2003 production increases in Brazil and Vietnam drove down the price of coffee by 73 percent in global markets, triggering the “international coffee crisis”. We examine the effect of this exogenous price shock on Colombia’s civil war, exploring whether politically-motivated violence presented different dynamics in the coffee –growing regions relative to the non- coffee regions, during the pre-crisis and crisis periods. Using a difference-in-differences framework, we find causal evidence that the steep decline in coffee prices substantially increased both the incidence and intensity of Colombia’s civil war. We also propose a simple model linking the price shock to violence and empirically examine the relative importance of three potential mechanisms. While crop substitution from coffee to coca explains very little of the variation, a disproportionate increase in poverty in coffee areas is associated with greater violence, as is a lower state capacity.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by UNIVERSIDAD DE LOS ANDES-CEDE in its series DOCUMENTOS CEDE with number 003460.
Date of creation: 10 Dec 2006
Date of revision:
Contact details of provider:
Other versions of this item:
- Oeindrila Dube & Juan F. Vargas, 2006. "Resource Curse in Reverse: The Coffee Crisis and Armed Conflict in Colombia," Royal Holloway, University of London: Discussion Papers in Economics 06/05, Department of Economics, Royal Holloway University of London, revised Dec 2006.
- D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
- Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Collier, Paul & Hoeffler, Anke, 2000.
"Greed and grievance in civil war,"
Policy Research Working Paper Series
2355, The World Bank.
- Robinson, James A & Torvik, Ragnar & Verdier, Thierry, 2002.
"Political Foundations of the Resource Curse,"
CEPR Discussion Papers
3422, C.E.P.R. Discussion Papers.
- Grossman, Herschel I, 1991. "A General Equilibrium Model of Insurrections," American Economic Review, American Economic Association, vol. 81(4), pages 912-21, September.
- Mehlum, Halvor & Moene, Karl-Ove & Torvik, Ragnar, 2003.
"Institutions and the resource curse,"
29/2002, Oslo University, Department of Economics.
- Halvor Mehlum & Karl Moene & Ragnar Torvik, 2002. "Institutions and the resource curse," Development and Comp Systems 0210003, EconWPA.
- Halvor Mehlum & Karl Moene & Ragnar Torvik, 2002. "Institutions and the resource curse," GE, Growth, Math methods 0210004, EconWPA.
- Halvor Mehlum & Karl Moene & Ragnar Torvik, 2004. "Institutions and the Resource Curse," DEGIT Conference Papers c009_012, DEGIT, Dynamics, Economic Growth, and International Trade.
- Barron, Patrick & Kaiser, Kai & Pradhan, Menno, 2004. "Local conflict in Indonesia : Measuring incidence and identifying patterns," Policy Research Working Paper Series 3384, The World Bank.
- Do, Quy-Toan & Iyer, Lakshmi, 2007. "Poverty, social divisions, and conflict in Nepal," Policy Research Working Paper Series 4228, The World Bank.
- Sachs, Jeffrey D. & Warner, Andrew M., 1999. "The big push, natural resource booms and growth," Journal of Development Economics, Elsevier, vol. 59(1), pages 43-76, June.
- Jeffrey D. Sachs & Andrew M. Warner, 1995.
"Natural Resource Abundance and Economic Growth,"
NBER Working Papers
5398, National Bureau of Economic Research, Inc.
- Collier, Paul & Hoeffler, Anke, 1998. "On Economic Causes of Civil War," Oxford Economic Papers, Oxford University Press, vol. 50(4), pages 563-73, October.
- Edward Miguel & Shanker Satyanath & Ernest Sergenti, 2004. "Economic Shocks and Civil Conflict: An Instrumental Variables Approach," Journal of Political Economy, University of Chicago Press, vol. 112(4), pages 725-753, August.
- Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2002.
"How Much Should We Trust Differences-in-Differences Estimates?,"
NBER Working Papers
8841, National Bureau of Economic Research, Inc.
- Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-in-Differences Estimates?," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 249-275, February.
- Daniele Giovannucci & José Leibovich & Diego Pizano & Banco Mundial, 2002. "Colombia Coffee Sector Study," DOCUMENTOS CEDE 002135, UNIVERSIDAD DE LOS ANDES-CEDE.
- Deininger, Klaus, 2003. "Causes and consequences of civil strife - micro-level evidence from Uganda," Policy Research Working Paper Series 3045, The World Bank.
- Ahmed Mahmud & Juan Vargas, 2011.
"Combatant recruitment and the outcome of war,"
Economics of Governance,
Springer, vol. 12(1), pages 51-74, March.
- Poelhekke, Steven & van der Ploeg, Frederick, 2010.
"Do Natural Resources Attract FDI? Evidence from Non-Stationary Sector-Level Data,"
CEPR Discussion Papers
8079, C.E.P.R. Discussion Papers.
- Steven Poelhekke & Frederick van der Ploeg, 2010. "Do Natural Resources Attract FDI? Evidence from non-stationary sector level data," DNB Working Papers 266, Netherlands Central Bank, Research Department.
- Patricia Justino, 2012.
"Shared Societies and Armed Conflict: Costs, Inequality and the Benefits of Peace,"
2012/35, Maastricht School of Management.
- Patricia Justino, 2012. "Shared Societies and Armed Conflict: Costs, Inequality and the Benefits of Peace," HiCN Working Papers 125, Households in Conflict Network.
- Hvid, Anna Kirstine & Henningsen, Geraldine Adrienne, 2014. "A new scramble for land or an unprecedented opportunity for the rural poor? Distributional consequences of increasing land rents in developing countries," MPRA Paper 52919, University Library of Munich, Germany.
- Rettberg, Angelika & Leiteritz, Ralf & Nasi, Carlo, 2010. "Entrepreneurial Activity and Civil War in Colombia: Exploring the Mutual Determinants between Armed Conflict and the Private Sector," Working Paper Series UNU-WIDER Working Paper W, World Institute for Development Economic Research (UNU-WIDER).
- Hernando Zuleta & Juanita Villaveces, 2008. "Conflict and negotiation: a game theoretical approach," DOCUMENTOS DE TRABAJO 005148, UNIVERSIDAD DEL ROSARIO.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (UNIVERSIDAD DE LOS ANDES-CEDE).
If references are entirely missing, you can add them using this form.