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The economics of violence in natural states

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  • van Besouw, Bram
  • Ansink, Erik
  • van Bavel, Bas

Abstract

Violence is key to understanding human interaction and societal development. The natural state of societal organization is that a subset of the population, capable of mustering organized large-scale violence, forms an elite coalition that restrains both violence and coercive appropriation. We highlight key mechanisms underlying such natural states. Our results show that natural states either have a large elite coalition and a high tax rate, or a weak elite and a high level of appropriation by a large group of violence specialists outside the elite, termed warlords. When output elasticity of effort is high, it induces elite members to limit their tax rate, which in turn promotes warlordism. Only when the elite coalition is small but still able to control a sizeable share of production, as a result of its cooperative quality and a low decisiveness of conflict between elite and warlords, do we find comparatively high levels of production and producer welfare. Our results imply that almost all natural states experience continuous coercion exercised by elite members and violence between elite coalitions and warlords. We show that this is not a temporary out-of-equilibrium-situation but a permanent phenomenon, as can most conspicuously be observed in parts of Sub-Saharan Africa. Our model thus illustrates the rigidity of natural states.

Suggested Citation

  • van Besouw, Bram & Ansink, Erik & van Bavel, Bas, 2016. "The economics of violence in natural states," Journal of Economic Behavior & Organization, Elsevier, vol. 132(PA), pages 139-156.
  • Handle: RePEc:eee:jeborg:v:132:y:2016:i:pa:p:139-156
    DOI: 10.1016/j.jebo.2016.10.009
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    Cited by:

    1. Pedro Naso & Erwin Bulte & Tim Swanson, 2017. "Can there be benefits from competing legal regimes? The impact of legal pluralism in post-conflict Sierra Leone," CIES Research Paper series 56-2017, Centre for International Environmental Studies, The Graduate Institute.
    2. Van Bavel, Bas & Ansink, Erik & Van Besouw, Bram, 2017. "Understanding the economics of limited access orders: incentives, organizations and the chronology of developments," Journal of Institutional Economics, Cambridge University Press, vol. 13(01), pages 109-131, March.

    More about this item

    Keywords

    Violence; Institutions; Natural state; Limited access order; Appropriation;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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