IDEAS home Printed from https://ideas.repec.org/p/oxf/oxcrwp/067.html
   My bibliography  Save this paper

Do Giant Oilfield Discoveries Fuel Internal Armed Conflicts?

Author

Listed:
  • Yu-Hsiang Lei
  • Guy Michaels

Abstract

We use new data to examine the effects of giant oilfield discoveries around the world since 1946. On average, these discoveries increase per capita oil production and oil exports by up to 50 percent. But these giant oilfield discoveries also have a dark side: they increase the incidence of internal armed conflict by about 5-8 percentage points. This increased incidence of conflict due to giant oilfield discoveries is especially high for countries that had already experienced armed conflicts or coups in the decade prior to discovery.

Suggested Citation

  • Yu-Hsiang Lei & Guy Michaels, 2011. "Do Giant Oilfield Discoveries Fuel Internal Armed Conflicts?," OxCarre Working Papers 067, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
    • Handle: RePEc:oxf:oxcrwp:067
    as

    Download full text from publisher

    File URL: https://ora.ox.ac.uk/objects/uuid:a4cb3fa9-94bc-4d7f-a2d8-f7121a578424
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Joshua D. Angrist & Adriana D. Kugler, 2008. "Rural Windfall or a New Resource Curse? Coca, Income, and Civil Conflict in Colombia," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 191-215, May.
    2. 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.
    3. Marshall Burke & John Dykema & David Lobell & Edward Miguel & Shanker Satyanath, 2010. "Climate and Civil War: Is the Relationship Robust?," NBER Working Papers 16440, National Bureau of Economic Research, Inc.
    4. Oeindrila Dube & Juan F. Vargas, 2013. "Commodity Price Shocks and Civil Conflict: Evidence from Colombia," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(4), pages 1384-1421.
    5. Mariaflavia Harari & Eliana La Ferrara, 2018. "Conflict, Climate, and Cells: A Disaggregated Analysis," The Review of Economics and Statistics, MIT Press, vol. 100(4), pages 594-608, October.
    6. Francesco Caselli & Massimo Morelli & Dominic Rohner, 2015. "The Geography of Interstate Resource Wars," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 130(1), pages 267-315.
    7. Guy Michaels, 2011. "The Long Term Consequences of Resource‐Based Specialisation," Economic Journal, Royal Economic Society, vol. 121(551), pages 31-57, March.
    8. Alesina, Alberto & Devleeschauwer, Arnaud & Easterly, William & Kurlat, Sergio & Wacziarg, Romain, 2003. "Fractionalization," Journal of Economic Growth, Springer, vol. 8(2), pages 155-194, June.
    9. Bellows, John & Miguel, Edward, 2009. "War and local collective action in Sierra Leone," Journal of Public Economics, Elsevier, vol. 93(11-12), pages 1144-1157, December.
    10. Paul Collier & Anke Hoeffler, 2004. "Greed and grievance in civil war," Oxford Economic Papers, Oxford University Press, vol. 56(4), pages 563-595, October.
    11. Ernesto Dal Bó & Pedro Dal Bó, 2011. "Workers, Warriors, And Criminals: Social Conflict In General Equilibrium," Journal of the European Economic Association, European Economic Association, vol. 9(4), pages 646-677, August.
    12. Garfinkel, Michelle R. & Skaperdas, Stergios, 2007. "Economics of Conflict: An Overview," Handbook of Defense Economics, in: Keith Hartley & Todd Sandler (ed.), Handbook of Defense Economics, edition 1, volume 2, chapter 22, pages 649-709, Elsevier.
    13. Anca M. Cotet & Kevin K. Tsui, 2013. "Oil and Conflict: What Does the Cross Country Evidence Really Show?," American Economic Journal: Macroeconomics, American Economic Association, vol. 5(1), pages 49-80, January.
    14. Macartan Humphreys, 2005. "Natural Resources, Conflict, and Conflict Resolution," Journal of Conflict Resolution, Peace Science Society (International), vol. 49(4), pages 508-537, August.
    15. Nathan Nunn & Nancy Qian, 2014. "US Food Aid and Civil Conflict," American Economic Review, American Economic Association, vol. 104(6), pages 1630-1666, June.
    16. Daron Acemoglu & Davide Ticchi & Andrea Vindigni, 2010. "A Theory of Military Dictatorships," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(1), pages 1-42, January.
    17. Joan Esteban & Laura Mayoral & Debraj Ray, 2012. "Ethnicity and Conflict: An Empirical Study," American Economic Review, American Economic Association, vol. 102(4), pages 1310-1342, June.
    18. Francesco Caselli & Tom Cunningham, 2009. "Leader behaviour and the natural resource curse," Oxford Economic Papers, Oxford University Press, vol. 61(4), pages 628-650, October.
    19. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    20. Francesco Caselli & Guy Michaels, 2013. "Do Oil Windfalls Improve Living Standards? Evidence from Brazil," American Economic Journal: Applied Economics, American Economic Association, vol. 5(1), pages 208-238, January.
    21. Anca M. Cotet & Kevin K. Tsui, 2013. "Oil, Growth, and Health: What Does the Cross-Country Evidence Really Show?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 115(4), pages 1107-1137, October.
    22. Kevin K. Tsui, 2011. "More Oil, Less Democracy: Evidence from Worldwide Crude Oil Discoveries," Economic Journal, Royal Economic Society, vol. 121(551), pages 89-115, March.
    23. Collier, Paul & Hoeffler, Anke, 1998. "On Economic Causes of Civil War," Oxford Economic Papers, Oxford University Press, vol. 50(4), pages 563-573, October.
    24. Timothy Besley & Torsten Persson, 2009. "Repression or Civil War?," American Economic Review, American Economic Association, vol. 99(2), pages 292-297, May.
    25. Robert C. Feenstra & Robert E. Lipsey & Haiyan Deng & Alyson C. Ma & Hengyong Mo, 2005. "World Trade Flows: 1962-2000," NBER Working Papers 11040, National Bureau of Economic Research, Inc.
    26. Timothy Besley & Torsten Persson, 2011. "The Logic of Political Violence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 126(3), pages 1411-1445.
    27. Michael L. Ross, 2004. "What Do We Know about Natural Resources and Civil War?," Journal of Peace Research, Peace Research Institute Oslo, vol. 41(3), pages 337-356, May.
    28. Edward Miguel & Shanker Satyanath, 2011. "Re-examining Economic Shocks and Civil Conflict," American Economic Journal: Applied Economics, American Economic Association, vol. 3(4), pages 228-232, October.
    29. Paivi Lujala, 2010. "The spoils of nature: Armed civil conflict and rebel access to natural resources," Journal of Peace Research, Peace Research Institute Oslo, vol. 47(1), pages 15-28, January.
    30. International Monetary Fund, 2010. "A Historical Public Debt Database," IMF Working Papers 2010/245, International Monetary Fund.
    31. Corden, W Max & Neary, J Peter, 1982. "Booming Sector and De-Industrialisation in a Small Open Economy," Economic Journal, Royal Economic Society, vol. 92(368), pages 825-848, December.
    32. Nils Petter Gleditsch & Peter Wallensteen & Mikael Eriksson & Margareta Sollenberg & Hã…Vard Strand, 2002. "Armed Conflict 1946-2001: A New Dataset," Journal of Peace Research, Peace Research Institute Oslo, vol. 39(5), pages 615-637, September.
    33. Caselli, Francesco & Cunningham, Tom, 2009. "Leader behavior and the natural resource curse," LSE Research Online Documents on Economics 25430, London School of Economics and Political Science, LSE Library.
    34. Philip R. Lane & Aaron Tornell, 1999. "The Voracity Effect," American Economic Review, American Economic Association, vol. 89(1), pages 22-46, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nemera Gebeyehu Mamo, 2018. "Essays on natural resources in Africa: local economic development, multi-ethnic coalitions and armed conflict," Economics PhD Theses 0518, Department of Economics, University of Sussex Business School.
    2. Arinze Nwokolo, 2018. "Oil Price Shocks and Civil Conflict: Evidence from Nigeria," HiCN Working Papers 274, Households in Conflict Network.
    3. Camille Laville, 2018. "The econometrical causal analysis of internal conflicts: The evolutions of a growing literature [L’analyse économétrique des conflits internes par l’approche causale : les évolutions d’une littérat," Working Papers hal-01940461, HAL.
    4. Stoop, Nik & Verpoorten, Marijke & van der Windt, Peter, 2019. "Artisanal or industrial conflict minerals? Evidence from Eastern Congo," World Development, Elsevier, vol. 122(C), pages 660-674.
    5. Camille Laville, 2018. "The econometrical causal analysis of internal conflicts: The evolutions of a growing literature [L’analyse économétrique des conflits internes par l’approche causale : les évolutions d’une littérat," CERDI Working papers hal-01940461, HAL.
    6. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    7. Morelli, Massimo & Rohner, Dominic, 2015. "Resource concentration and civil wars," Journal of Development Economics, Elsevier, vol. 117(C), pages 32-47.
    8. Jetter, Michael, 2016. "Peace, Terrorism, or Civil Conflict? Understanding the Decision of an Opposition Group," IZA Discussion Papers 9996, Institute of Labor Economics (IZA).
    9. Francesco Caselli & Andrea Tesei, 2016. "Resource Windfalls, Political Regimes, and Political Stability," The Review of Economics and Statistics, MIT Press, vol. 98(3), pages 573-590, July.
    10. Rabah Arezki & Sambit Bhattacharyya & Nemera Mamo, 2015. "Resource Discovery and Conflict in Africa: What do the data show?," OxCarre Working Papers 159, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.
    11. Cordella, Tito & Onder, Harun, 2020. "Sharing oil rents and political violence," European Journal of Political Economy, Elsevier, vol. 63(C).
    12. Massimo Morelli & Dominic Rohner, 2023. "Natural resources and conflict: The crucial role of power mismatch and geographic asymmetries," Working Papers 698, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    13. Nicolas Berman & Mathieu Couttenier & Dominic Rohner & Mathias Thoenig, 2017. "This Mine Is Mine! How Minerals Fuel Conflicts in Africa," American Economic Review, American Economic Association, vol. 107(6), pages 1564-1610, June.
    14. Massimiliano Calì & Alen Mulabdic, 2017. "Trade and civil conflict: Revisiting the cross-country evidence," Review of International Economics, Wiley Blackwell, vol. 25(1), pages 195-232, February.
    15. Adhvaryu, Achyuta & Fenske, James & Khanna, Gaurav & Nyshadham, Anant, 2021. "Resources, conflict, and economic development in Africa," Journal of Development Economics, Elsevier, vol. 149(C).
    16. Zhukov, Yuri M., 2016. "Trading hard hats for combat helmets: The economics of rebellion in eastern Ukraine," Journal of Comparative Economics, Elsevier, vol. 44(1), pages 1-15.
    17. Eoin McGuirk, 2013. "The illusory leader: natural resources, taxation and accountability," Public Choice, Springer, vol. 154(3), pages 285-313, March.
    18. Farzanegan, Mohammad Reza & Lessmann, Christian & Markwardt, Gunther, 2018. "Natural resource rents and internal conflicts: Can decentralization lift the curse?," Economic Systems, Elsevier, vol. 42(2), pages 186-205.
    19. Andersen, Jørgen Juel & Aslaksen, Silje, 2013. "Oil and political survival," Journal of Development Economics, Elsevier, vol. 100(1), pages 89-106.
    20. Gustavo Javier Canavire-Bacarreza & Christopher Cotton & Michael Jetter & Alejandra Montoya-Agudelo, 2019. "Polarized education levels and civil unrest," Working Paper 1417, Economics Department, Queen's University.

    More about this item

    Keywords

    Natural Resources; Resource Curse; Petroleum; Armed Conflict; Civil War;
    All these keywords.

    JEL classification:

    • Q34 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Natural Resources and Domestic and International Conflicts
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oxf:oxcrwp:067. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Melis Boya (email available below). General contact details of provider: https://edirc.repec.org/data/oxcaruk.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.