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Battlefields and marketplaces

  • Halvor Mehlum
  • Karl Moene

Divided societies in the developing world experience wasteful struggles for power. We study the relationship between political stability and resources wasted in the struggle within a model of competitive power contests. The model of power contests is similar in structure to models describing oligopolistic market competition. This analogy helps us in deriving results that are new to the conflict literature. We show, for example, that the Herfindahl-Hirschman index can be interpreted as a measure of power concentration and that a peace treaty between fighting groups has a parallel in tacit collusion between firms in a market.

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Article provided by Taylor & Francis Journals in its journal Defence and Peace Economics.

Volume (Year): 13 (2002)
Issue (Month): 6 ()
Pages: 485-496

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Handle: RePEc:taf:defpea:v:13:y:2002:i:6:p:485-496
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  1. Moene, K.O., 1992. "Contested Power," Memorandum 19/1992, Oslo University, Department of Economics.
  2. Hirshleifer, Jack, 1995. "Anarchy and Its Breakdown," Journal of Political Economy, University of Chicago Press, vol. 103(1), pages 26-52, February.
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  11. Hirshleifer, Jack, 1995. "Theorizing about conflict," Handbook of Defense Economics, in: Keith Hartley & Todd Sandler (ed.), Handbook of Defense Economics, edition 1, volume 1, chapter 7, pages 165-189 Elsevier.
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