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Economic Consequences of Wars: Evidence from Landmine Contamination in Mozambique

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  • Ouarda Merrouche

Abstract

This paper evaluates the economic returns to improved households access to infrastructure, public services and land in the context of a large landmineclearance program in post-war Mozambique. The International Campaign to Ban Landmines production and use estimates that there are more than 80 billion landmines in the ground in more than 80 countries. Despite the scale of the problem and large investments by OECD countries to clear mines in low income countries, the economic consequences of landmine contamination have been so far unexamined by economists working on the economics of wars, perhaps due to the lack of data thus far. The evaluation uses a unique dataset on landmine contamination intensity covering 126 Mozambican districts to evaluate the causal impact of landmine contamination on income and welfare. The method uses a difference-in-difference estimator to correct for selection in landmine placement. I find large and statistically significant effects of landmine contamination on poverty (in level and depth) and consumption per capita. Hence, the cost-benefit analysis indicates that despite the high cost to clear a mine under reasonable assumptions the program generates a positive return.

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Bibliographic Info

Paper provided by European University Institute in its series Economics Working Papers with number ECO2006/22.

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Date of creation: 2006
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Handle: RePEc:eui:euiwps:eco2006/22

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Related research

Keywords: war; poverty; landmines; difference-in-difference estimator; cost-benefit analysis;

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  1. Massimo Guidolin & Eliana La Ferrara, 2007. "Diamonds Are Forever, Wars Are Not: Is Conflict Bad for Private Firms?," American Economic Review, American Economic Association, vol. 97(5), pages 1978-1993, December.
  2. Alberto Abadie & Javier Gardeazabal, 2001. "The Economic Costs of Conflict: A Case-Control Study for the Basque Country," NBER Working Papers 8478, National Bureau of Economic Research, Inc.
  3. Simler, Kenneth R. & Nhate, Virgulino, 2005. "Poverty, inequality, and geographic targeting," FCND briefs 192, International Food Policy Research Institute (IFPRI).
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Cited by:
  1. Ouarda Merrouche, 2006. "The long-term educational cost of war: evidence from landmine contamination in Cambodia," IFS Working Papers W06/11, Institute for Fiscal Studies.

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