Quantifying Mozambique's Peace Dividend: An Application of the Synthetic Control Method

Using the synthetic control method and data from 20 African countries, this study quantifies the peace dividend in Mozambique, a country that experienced over 15 years of civil war. More specifically, we use data from 1977 to 2018 to investigate whether the end of the civil war in Mozambique in 1992 brought significant benefits to the country's economic performance. Despite the robust growth observed post‐1992, it is important to determine how much of this can be attributed to peace. Our findings suggest that the end of the war significantly boosted Mozambique's economy, with average real annual GDP over 1992–2010 being over 60% higher than what it would have been had the war continued. This resulted in an accumulated gain in aggregate GDP of US$100 billion over the period 1992–2010 or an annual average gain of about US$ 5 billion. The positive effects, however, were only evident from 1993, hinting at possible legacy effects of the war. The study's results align with other research on the economic impact of conflicts in Africa and are robust to placebo and other sensitivity robustness tests.