IDEAS home Printed from https://ideas.repec.org/a/bla/jeurec/v9y2011i4p646-677.html
   My bibliography  Save this article

Workers, Warriors, And Criminals: Social Conflict In General Equilibrium

Author

Listed:
  • Ernesto Dal Bó
  • Pedro Dal Bó

Abstract

We offer a simple general equilibrium model to analyze how economy-wide forces (i.e. shocks to terms of trade, technology and endowments) will affect the intensity of social conflict over the distribution of resources. Examples of conflict activities range from crime to civil war. We show that not all favorable shocks to an economy will reduce conflict, even when they could make society richer. Rather, positive shocks to labor intensive industries will raise wages and diminish social conflict, while positive shocks to capital intensive industries will do just the opposite. The key requirement is that the appropriation activity be more labor intensive than the average of the productive industries. Our model can account for the curse of natural resources, it explains why aid in kind to war ridden societies may have perverse effects, and how international trade policy should be debated if civil conflict in poorer countries is a concern. Including appropriation activities into a canonic general equilibrium model introduces a social constraint to policy analysis. Thus, we can also account for "optimal populist" policies, and "national development" strategies
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • 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.
    • Handle: RePEc:bla:jeurec:v:9:y:2011:i:4:p:646-677
    DOI: j.1542-4774.2011.01025.x
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/j.1542-4774.2011.01025.x
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/j.1542-4774.2011.01025.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Mussa, Michael, 1974. "Tariffs and the Distribution of Income: The Importance of Factor Specificity, Substitutability, and Intensity in the Short and Long Run," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1191-1203, Nov.-Dec..
    2. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    3. Fearon, James D. & Laitin, David D., 2003. "Ethnicity, Insurgency, and Civil War," American Political Science Review, Cambridge University Press, vol. 97(1), pages 75-90, February.
    4. Skaperdas, Stergios, 1992. "Cooperation, Conflict, and Power in the Absence of Property Rights," American Economic Review, American Economic Association, vol. 82(4), pages 720-739, September.
    5. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
    6. Daron Acemoglu & James A. Robinson, 2001. "A Theory of Political Transitions," American Economic Review, American Economic Association, vol. 91(4), pages 938-963, September.
    7. MacCulloch, Robert, 1999. "What makes a revolution?," ZEI Working Papers B 24-1999, University of Bonn, ZEI - Center for European Integration Studies.
    8. Grossman, Herschel I & Kim, Minseong, 1995. "Swords or Plowshares? A Theory of the Security of Claims to Property," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1275-1288, December.
    9. Powell, Robert, 2004. "The Inefficient Use of Power: Costly Conflict with Complete Information," American Political Science Review, Cambridge University Press, vol. 98(2), pages 231-241, May.
    10. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 26-52, February.
    11. Fajnzylber, Pablo & Lederman, Daniel & Loayza, Norman, 2002. "Inequality and Violent Crime," Journal of Law and Economics, University of Chicago Press, vol. 45(1), pages 1-40, April.
    12. Acemoglu, Daron & Robinson, James A., 2001. "Inefficient Redistribution," American Political Science Review, Cambridge University Press, vol. 95(3), pages 649-661, September.
    13. Bhagwati, Jagdish N & Srinivasan, T N, 1980. "Revenue Seeking: A Generalization of the Theory of Tariffs," Journal of Political Economy, University of Chicago Press, vol. 88(6), pages 1069-1087, December.
    14. Ronald W. Jones, 2018. "The Structure of Simple General Equilibrium Models," World Scientific Book Chapters, in: International Trade Theory and Competitive Models Features, Values, and Criticisms, chapter 4, pages 61-84, World Scientific Publishing Co. Pte. Ltd..
    15. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
    16. Grossman, Herschel I, 1991. "A General Equilibrium Model of Insurrections," American Economic Review, American Economic Association, vol. 81(4), pages 912-921, September.
    17. Rafael Di Tella & Alberto Ades, 1999. "Rents, Competition, and Corruption," American Economic Review, American Economic Association, vol. 89(4), pages 982-993, September.
    18. Collier, Paul & Hoeffler, Anke, 1998. "On Economic Causes of Civil War," Oxford Economic Papers, Oxford University Press, vol. 50(4), pages 563-573, October.
    19. Coate, Stephen & Morris, Stephen, 1995. "On the Form of Transfers in Special Interests," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1210-1235, December.
    20. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
    21. Wolfgang F. Stolper & Paul A. Samuelson, 1941. "Protection and Real Wages," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 9(1), pages 58-73.
    22. Grogger, Jeff, 1998. "Market Wages and Youth Crime," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 756-791, October.
    23. Garfinkel, Michelle R, 1990. "Arming as a Strategic Investment in a Cooperative Equilibrium," American Economic Review, American Economic Association, vol. 80(1), pages 50-68, March.
    24. 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.
    25. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-565, May-June.
    26. Gary S. Becker, 1983. "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(3), pages 371-400.
    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. Robert MacCulloch & Silvia Pezzini, 2010. "The Roles of Freedom, Growth, and Religion in the Taste for Revolution," Journal of Law and Economics, University of Chicago Press, vol. 53(2), pages 329-358, May.
    2. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    3. Vahabi,Mehrdad, 2019. "The Political Economy of Predation," Cambridge Books, Cambridge University Press, number 9781107591370, June.
    4. Mitra, Anirban & Mitra, Shabana, 2020. "Redistribution of Economic Resources due to Conflict: The Maoist Uprising in Nepal," Journal of Comparative Economics, Elsevier, vol. 48(3), pages 578-604.
    5. Jan U. Auerbach & Costas Azariadis, 2015. "Property Rights, Governance, and Economic Development," Review of Development Economics, Wiley Blackwell, vol. 19(2), pages 210-220, May.
    6. David Castells-Quintana & Maria del Pilar Lopez-Uribe & Tom McDermott, 2015. "Climate change and the geographical and institutional drivers of economic development," GRI Working Papers 198, Grantham Research Institute on Climate Change and the Environment.
    7. MacCulloch, Robert, 1999. "What makes a revolution?," ZEI Working Papers B 24-1999, University of Bonn, ZEI - Center for European Integration Studies.
    8. Lopez-Uribe, Maria del Pilar & Castells-Quintana, David & McDermott, Thomas K. J., 2017. "Geography, institutions and development: a review ofthe long-run impacts of climate change," LSE Research Online Documents on Economics 65147, London School of Economics and Political Science, LSE Library.
    9. 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.
    10. 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.
    11. Christopher Blattman, 2009. "Civil War: A Review of Fifty Years of Research," Working Papers id:2231, eSocialSciences.
    12. Willa Friedman, 2013. "Local Economic Conditions and Participation in the Rwandan Genocide," HiCN Working Papers 160, Households in Conflict Network.
    13. Mahdi FAWAZ, 2020. "Ressources naturelles et guerres civiles au Moyen-Orient," Bordeaux Economics Working Papers 2020-09, Bordeaux School of Economics (BSE).
    14. Thiemo Fetzer & Samuel Marden, 2017. "Take What You Can: Property Rights, Contestability and Conflict," Economic Journal, Royal Economic Society, vol. 0(601), pages 757-783, May.
    15. M. Christian Lehmann, 2020. "Aiding refugees, aiding peace?," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(5), pages 1687-1704, September.
    16. Mehrdad Vahabi, 2011. "The Economics of Destructive Power," Chapters, in: Derek L. Braddon & Keith Hartley (ed.), Handbook on the Economics of Conflict, chapter 5, Edward Elgar Publishing.
    17. Jiancai Pi & Pengqing Zhang, 2017. "Social conflict and wage inequality," Journal of Economics, Springer, vol. 121(1), pages 29-49, May.
    18. Nathan Fiala & Stergios Skaperdas, 2011. "Economic Perspectives on Civil Wars," Chapters, in: Christopher J. Coyne & Rachel L. Mathers (ed.), The Handbook on the Political Economy of War, chapter 10, Edward Elgar Publishing.
    19. Jiancai Pi & Pengqing Zhang, 2020. "Organized crime and wage inequality," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(3), pages 344-361, July.
    20. Jonathan Brooks, 1996. "Agricultural Policies In Oecd Countries: What Can We Learn From Political Economy Models?," Journal of Agricultural Economics, Wiley Blackwell, vol. 47(1‐4), pages 366-389, January.

    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior

    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:bla:jeurec:v:9:y:2011:i:4:p:646-677. 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: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/eeaaaea.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.