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Referendum, response, and consequences for Sudan : the game between juba and khartoum

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  • Elbadawi, Ibrahim
  • Milante, Gary
  • Pischedda, Costantino

Abstract

This paper presents a game theory model of the strategic interaction between Khartoum and Juba leading up to the referendum on Sudan's partition in 2011. The findings show that excessive militarization and brinksmanship is a rational response for both actors, neither of which can credibly commit to lower levels of military spending under the current status quo. This militarization is often at the expense of health and education expenditures, suggesting that the opportunity cost of militarization is foregone economic development. These credibility issues might be resolved by democratization, increased transparency, reduction of information asymmetries, and efforts to promote economic and political cooperation. The paper explores these devices, demonstrating how they can contribute to Pareto preferred outcomes in equilibrium. The authors characterize the military expenditure associated with the commitment problem experienced by both sides, estimate its costs from data for Sudan, and identify the opportunity cost of foregone development implied by continued, excessive, and unsustainable militarization.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4684.

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Date of creation: 01 Jul 2008
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Handle: RePEc:wbk:wbrwps:4684

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Keywords: Post Conflict Reconstruction; Peace&Peacekeeping; Population Policies; Public Sector Expenditure Analysis&Management; Debt Markets;

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  1. Jack, William & Lagunoff, Roger, 2006. "Dynamic enfranchisement," Journal of Public Economics, Elsevier, vol. 90(4-5), pages 551-572, May.
  2. Philip Keefer, 2008. "Insurgency and Credible Commitment in Autocracies and Democracies," World Bank Economic Review, World Bank Group, World Bank Group, vol. 22(1), pages 33-61, January.
  3. Hirshleifer, Jack, 1991. "The Technology of Conflict as an Economic Activity," American Economic Review, American Economic Association, vol. 81(2), pages 130-34, May.
  4. Skaperdas, Stergios, 1996. "Contest Success Functions," Economic Theory, Springer, vol. 7(2), pages 283-90, February.
  5. Fearon, James D., 1995. "Rationalist explanations for war," International Organization, Cambridge University Press, Cambridge University Press, vol. 49(03), pages 379-414, June.
  6. Nicholas Sambanis, 2008. "Short- and Long-Term Effects of United Nations Peace Operations," World Bank Economic Review, World Bank Group, World Bank Group, vol. 22(1), pages 9-32, January.
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