Advanced Search
MyIDEAS: Login

Explaining Conflict in Low-Income Countries: Incomplete Contracting in the Shadow of the Future

Contents:

Author Info

  • Michael McBride

    () (Department of Economics, University of California-Irvine)

  • Stergios Skaperdas

    () (Department of Economics, University of California-Irvine)

Abstract

We examine two factors that help explain the prevalence of conflict in low-income countries: that adversaries cannot enforce long-term contracts in arms, and that open conflict alters the future strategic positions of the adversaries differently than does peace. Using an infinite horizon model, we show the conditions under which adversaries will not be able to sustain short-term contracts even though doing so is Pareto superior to open conflict. Conflict arises because adversaries attempt to gain future strategic supremacy that only victory in conflict brings. Lower incomes or wages, as well as higher discount factors and the less destructive conflict is, the higher is the likelihood of war.

Download Info

If 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.
File URL: http://www.economics.uci.edu/files/economics/docs/workingpapers/2005-06/McBride-06.pdf
Download Restriction: no

Bibliographic Info

Paper provided by University of California-Irvine, Department of Economics in its series Working Papers with number 050606.

as in new window
Length: 23 pages
Date of creation: Oct 2005
Date of revision:
Handle: RePEc:irv:wpaper:050606

Contact details of provider:
Postal: Irvine, CA 92697-3125
Phone: (949) 824-5788
Web page: http://www.economics.uci.edu/
More information through EDIRC

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
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.:
as in new window
  1. Bester, Helmut & Konrad, Kai A., 2003. "Easy targets and the timing of conflict," Center for European, Governance and Economic Development Research Discussion Papers 21, University of Goettingen, Department of Economics.
  2. Stergios Skaperdas, 2008. "An economic approach to analyzing civil wars," Economics of Governance, Springer, vol. 9(1), pages 25-44, January.
  3. Budd, Christopher & Harris, Christopher & Vickers, John, 1993. "A Model of the Evolution of Duopoly: Does the Asymmetry between Firms Tend to Increase or Decrease?," Review of Economic Studies, Wiley Blackwell, vol. 60(3), pages 543-73, July.
  4. Gregory D. Hess, 2003. "The Economic Welfare Cost of Conflict: An Empirical Assessment," CESifo Working Paper Series 852, CESifo Group Munich.
  5. Genicot, C. & Skaperdas, S., 2000. "Investing in Confict Management," Papers 00-01-17, California Irvine - School of Social Sciences.
  6. Fearon, James D., 1995. "Rationalist explanations for war," International Organization, Cambridge University Press, vol. 49(03), pages 379-414, June.
  7. 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.
  8. Grossman, Sanford J & Hart, Oliver, 1985. "The Cost and Benefits of Ownership: A Theory of Vertical and Lateral Integration," CEPR Discussion Papers 70, C.E.P.R. Discussion Papers.
  9. Halvor Mehlum & Karl Moene, 2006. "Fighting against the odds," Economics of Governance, Springer, vol. 7(1), pages 75-87, 01.
  10. 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.
  11. Gradstein, Mark, 2002. "Governance and Growth," CEPR Discussion Papers 3270, C.E.P.R. Discussion Papers.
  12. Harris, Christopher & Vickers, John, 1987. "Racing with Uncertainty," Review of Economic Studies, Wiley Blackwell, vol. 54(1), pages 1-21, January.
  13. Bester, Helmut & Konrad, Kai A., 2004. "Delay in contests," European Economic Review, Elsevier, vol. 48(5), pages 1169-1178, October.
  14. McBride, Michael, 2005. "Crises, reforms, and regime persistence in sub-Saharan Africa," European Journal of Political Economy, Elsevier, vol. 21(3), pages 688-707, September.
  15. 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.
  16. Gradstein, Mark, 2004. "Governance and growth," Journal of Development Economics, Elsevier, vol. 73(2), pages 505-518, April.
  17. Bester, Helmut & Konrad, Kai A., 2003. "Easy targets and the timing of conflict," Center for European, Governance and Economic Development Research Discussion Papers 21, University of Goettingen, Department of Economics.
  18. Jack Hirshleifer, 1989. "Conflict and rent-seeking success functions: Ratio vs. difference models of relative success," Public Choice, Springer, vol. 63(2), pages 101-112, November.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Hoffmann, Magnus, 2007. "The Social Benefit of War," MPRA Paper 6196, University Library of Munich, Germany.
  2. Stergios Skaperdas, 2006. "Bargaining Versus Fighting," Defence and Peace Economics, Taylor and Francis Journals, vol. 17(6), pages 657-676.
  3. repec:sae:jocore:v:55:y:2011:i:3:p:446-468 is not listed on IDEAS
  4. Christopher Blattman & Edward Miguel, 2009. "Civil War: A Review of Fifty Years of Research," Working Papers id:2231, eSocialSciences.
  5. Carmen Beviá & Luis C. Corchón, 2011. "Endogenous strength in conflicts," Economics Working Papers we1113, Universidad Carlos III, Departamento de Economía.
  6. Garfinkel, Michelle R. & Skaperdas, Stergios, 2007. "Economics of Conflict: An Overview," Handbook of Defense Economics, Elsevier.
  7. Michael McBride & Stergios Skaperdas, 2009. "Conflict, Settlement, and the Shadow of the Future," Working Papers 080922, University of California-Irvine, Department of Economics.
  8. 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.
  9. Francoise Forges & Frédéric Koessler, 2006. "Long Persuasion Games," CESifo Working Paper Series 1669, CESifo Group Munich.
  10. Stergios Skaperdas, 2008. "An economic approach to analyzing civil wars," Economics of Governance, Springer, vol. 9(1), pages 25-44, January.
  11. Michael McBride & Gary Milante & Stergios Skaperdas, 2009. "Peace and War with Endogenous State Capacity," Working Papers 091002, University of California-Irvine, Department of Economics.
  12. Konrad, Kai A., 2007. "Strategy in contests: an introduction," Discussion Papers, Research Unit: Market Processes and Governance SP II 2007-01, Social Science Research Center Berlin (WZB).
  13. repec:ner:carlos:info:hdl:10016/11621 is not listed on IDEAS
  14. Forges, Françoise, 2005. "The ex ante incentive compatible core of an exchange economy with and without indivisibilities," Open Access publications from Université Paris-Dauphine urn:hdl:123456789/167, Université Paris-Dauphine.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:irv:wpaper:050606

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gloria Simpson).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.