Deliberate displacement during conflict: Evidence from Colombia

Do economic incentives explain forced displacement during conflict? This paper examines this question in Colombia, which has had one of the world’s most acute situations of internal displacement associated with conflict. Using data on the price of bananas along with data on historical levels of production, I find that price increases generate more forced displacement in municipalities more suitable to produce this good. However, I also show that this effect is concentrated in the period in which paramilitary power and operations reached an all-time peak. Additional evidence shows that land concentration among the rich has increased substantially in districts that produce these goods. These findings are consistent with extensive qualitative evidence that documents the link between economic interests and local political actors who collude with illegal armed groups to forcibly displace locals and appropriate their land, especially in areas with more informal land tenure systems, like those where bananas are grown more frequently.