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On the spatial correlation of international conflict initiation and other binary and dyadic dependent variables

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  • Luo, Shali
  • Miller, J. Isaac

Abstract

We examine spatially correlated interregional flows measured as binary choice outcomes. Since the dependent variable is not only binary and dyadic, but also spatially correlated, we propose a spatial origin–destination probit model and a Bayesian estimation methodology that avoids inconsistent maximum likelihood estimates. We apply the model to militarized interstate dispute initiations, observations of which are clearly binary and dyadic and which may be spatially correlated due to their geographic distribution. Using a cross-section of 26 European countries drawn from the period leading up to WWII, we find empirical evidence for target-based spatial correlation and sizable network effects resulting from the correlation. In particular, we find that the effect of national military capability of the potential aggressor, which is a significant determinant of conflict in either case, is overstated in a benchmark model that ignores spatial correlation. This effect is further differentiated by the geographic location of a country.

Suggested Citation

  • Luo, Shali & Miller, J. Isaac, 2014. "On the spatial correlation of international conflict initiation and other binary and dyadic dependent variables," Regional Science and Urban Economics, Elsevier, vol. 44(C), pages 107-118.
  • Handle: RePEc:eee:regeco:v:44:y:2014:i:c:p:107-118
    DOI: 10.1016/j.regsciurbeco.2013.10.004
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    Keywords

    Spatial correlation; Origin–destination flows; Probit; Militarized interstate disputes; Correlates of war;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • N4 - Economic History - - Government, War, Law, International Relations, and Regulation

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