IDEAS home Printed from https://ideas.repec.org/p/ces/ceswps/_12458.html

On the Asymmetry Between Conflict and Development: Evidence from Sustainable Development Goals

Author

Listed:
  • Rabah Arezki
  • Hieu Nguyen

Abstract

This paper investigates the relationship between (internal) armed conflict and sustainable development. Using annual panel data on 192 countries from 2000 to 2024, we employ a variety of econometric techniques to trace the impulse responses between conflict fatalities and Sustainable Development Goal (SDG) performance in both directions. Results reveal a striking asymmetry: conflict shocks produce long-lasting adverse effects on SDG performance, while SDG performance shocks exert only transient effects on conflict intensity. This asymmetry persists across external and major conflict episodes, and is robust to alternative identification strategies. Our findings indicate that sustainable development is fundamentally contingent on prior achievement of peace.

Suggested Citation

  • Rabah Arezki & Hieu Nguyen, 2026. "On the Asymmetry Between Conflict and Development: Evidence from Sustainable Development Goals," CESifo Working Paper Series 12458, CESifo.
    • Handle: RePEc:ces:ceswps:_12458
    as

    Download full text from publisher

    File URL: https://www.ifo.de/DocDL/cesifo1_wp12458_0.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cheung, Yin-Wong & Lai, Kon S., 2000. "On the purchasing power parity puzzle," Journal of International Economics, Elsevier, vol. 52(2), pages 321-330, December.
    2. Kenneth Rogoff, 1996. "The Purchasing Power Parity Puzzle," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 647-668, June.
    3. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    4. John Y. Campbell & N. Gregory Mankiw, 1987. "Are Output Fluctuations Transitory?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 102(4), pages 857-880.
    5. Michael R.M. Abrigo & Inessa Love, 2016. "Estimation of Panel Vector Autoregression in Stata: a Package of Programs," Working Papers 201602, University of Hawaii at Manoa, Department of Economics.
    6. Fearon, James D. & Laitin, David D., 2003. "Ethnicity, Insurgency, and Civil War," American Political Science Review, Cambridge University Press, vol. 97(1), pages 75-90, February.
    7. Valerie Cerra & Sweta Chaman Saxena, 2008. "Growth Dynamics: The Myth of Economic Recovery," American Economic Review, American Economic Association, vol. 98(1), pages 439-457, March.
    8. Timothy Besley & Torsten Persson, 2011. "The Logic of Political Violence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 126(3), pages 1411-1445.
    9. Markus Bruckner & Antonio Ciccone, 2010. "International Commodities Prices, Growth and the Outbreak of Civil War in Sub-Saharan Africa," Working Papers 1008, BBVA Bank, Economic Research Department.
    10. Oeindrila Dube & Juan F. Vargas, 2013. "Commodity Price Shocks and Civil Conflict: Evidence from Colombia," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(4), pages 1384-1421.
    11. World Bank, 2011. "World Development Report 2011 [Rapport sur le développement dans le monde 2011 : Conflits, sécurité et développement - Abrégé]," World Bank Publications - Books, The World Bank Group, number 4389, April.
    12. Alberto Abadie & Javier Gardeazabal, 2003. "The Economic Costs of Conflict: A Case Study of the Basque Country," American Economic Review, American Economic Association, vol. 93(1), pages 113-132, March.
    13. Paul Collier & Anke Hoeffler, 2004. "Greed and grievance in civil war," Oxford Economic Papers, Oxford University Press, vol. 56(4), pages 563-595, October.
    14. Cochrane, John H, 1988. "How Big Is the Random Walk in GNP?," Journal of Political Economy, University of Chicago Press, vol. 96(5), pages 893-920, October.
    15. Alesina, Alberto & Özler, Sule & Roubini, Nouriel & Swagel, Phillip, 1996. "Political Instability and Economic Growth," Journal of Economic Growth, Springer, vol. 1(2), pages 189-211, June.
    16. Markus Brückner & Antonio Ciccone, 2010. "International Commodity Prices, Growth and the Outbreak of Civil War in Sub-Saharan Africa," Economic Journal, Royal Economic Society, vol. 120(544), pages 519-534, May.
    17. Paul Collier & V. L. Elliott & Håvard Hegre & Anke Hoeffler & Marta Reynal-Querol & Nicholas Sambanis, 2003. "Breaking the Conflict Trap : Civil War and Development Policy," World Bank Publications - Books, The World Bank Group, number 13938, April.
    18. United Nations UN, 2015. "Transforming our World: the 2030 Agenda for Sustainable Development," Working Papers id:7559, eSocialSciences.
    19. Massimo Guidolin & Eliana La Ferrara, 2007. "Diamonds Are Forever, Wars Are Not: Is Conflict Bad for Private Firms?," American Economic Review, American Economic Association, vol. 97(5), pages 1978-1993, December.
    20. Michael R. M. Abrigo & Inessa Love, 2016. "Estimation of panel vector autoregression in Stata," Stata Journal, StataCorp LLC, vol. 16(3), pages 778-804, September.
    21. Edward Miguel & Shanker Satyanath & Ernest Sergenti, 2004. "Economic Shocks and Civil Conflict: An Instrumental Variables Approach," Journal of Political Economy, University of Chicago Press, vol. 112(4), pages 725-753, August.
    22. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    23. Caroline Hartzell & Matthew Hoddie, 2003. "Institutionalizing Peace: Power Sharing and Post‐Civil War Conflict Management," American Journal of Political Science, John Wiley & Sons, vol. 47(2), pages 318-332, April.
    24. Clemens, Michael A. & Kenny, Charles J. & Moss, Todd J., 2007. "The Trouble with the MDGs: Confronting Expectations of Aid and Development Success," World Development, Elsevier, vol. 35(5), pages 735-751, May.
    25. Therése Pettersson & Shawn Davies & Amber Deniz & Garoun Engström & Nanar Hawach & Stina Högbladh & Margareta Sollenberg & Magnus Öberg, 2021. "Organized violence 1989–2020, with a special emphasis on Syria," Journal of Peace Research, Peace Research Institute Oslo, vol. 58(4), pages 809-825, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dominic Rohner & Mathias Thoenig, 2021. "The Elusive Peace Dividend of Development Policy: From War Traps to Macro Complementarities," Annual Review of Economics, Annual Reviews, vol. 13(1), pages 111-131, August.
    2. Janus, Thorsten & Riera-Crichton, Daniel, 2015. "Economic shocks, civil war and ethnicity," Journal of Development Economics, Elsevier, vol. 115(C), pages 32-44.
    3. Arinze Nwokolo, 2018. "Oil Price Shocks and Civil Conflict: Evidence from Nigeria," HiCN Working Papers 274, Households in Conflict Network.
    4. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    5. Eoin McGuirk & Marshall Burke, 2020. "The Economic Origins of Conflict in Africa," Journal of Political Economy, University of Chicago Press, vol. 128(10), pages 3940-3997.
    6. Bhattacharya, Prasad Sankar & Chowdhury, Prabal Roy & Rahman, Habibur, 2023. "Does credit availability mitigate domestic conflict?," Economic Modelling, Elsevier, vol. 119(C).
    7. Ahsan Kibria & Reza Oladi & Sherzod B. Akhundjanov, 2020. "Foreign direct investment and civil violence in Sub‐Saharan Africa," The World Economy, Wiley Blackwell, vol. 43(4), pages 948-981, April.
    8. Albornoz, Facundo & Hauk, Esther, 2014. "Civil war and U.S. foreign influence," Journal of Development Economics, Elsevier, vol. 110(C), pages 64-78.
    9. Dirks, Maximilian W. & Schmidt, Torsten, 2024. "Political instability and economic growth: Causation and transmission," European Journal of Political Economy, Elsevier, vol. 85(C).
    10. Lopes da Fonseca, Mariana & Baskaran, Thushyanthan, 2015. "Re-evaluating the economic costs of conflicts," University of Göttingen Working Papers in Economics 246, University of Goettingen, Department of Economics.
    11. Stergios Skaperdas, 2011. "The costs of organized violence: a review of the evidence," Economics of Governance, Springer, vol. 12(1), pages 1-23, March.
    12. Maystadt, Jean-François & Trinh Tan, Jean-François & Breisinger, Clemens, 2014. "Does food security matter for transition in Arab countries?," Food Policy, Elsevier, vol. 46(C), pages 106-115.
    13. van der Ploeg, Frederick & Rohner, Dominic, 2012. "War and natural resource exploitation," European Economic Review, Elsevier, vol. 56(8), pages 1714-1729.
    14. Massimiliano Calì & Alen Mulabdic, 2017. "Trade and civil conflict: Revisiting the cross-country evidence," Review of International Economics, Wiley Blackwell, vol. 25(1), pages 195-232, February.
    15. Manotas-Hidalgo, Beatriz & Pérez-Sebastián, Fidel & Campo-Bescós, Miguel Angel, 2021. "The role of ethnic characteristics in the effect of income shocks on African conflict," World Development, Elsevier, vol. 137(C).
    16. Gehring, Kai & Langlotz, Sarah & Kienberger, Stefan, 2018. "Stimulant or depressant? Resource-related income shocks and conflict," Working Papers 0652, University of Heidelberg, Department of Economics.
    17. Stephen Chaudoin & Zachary Peskowitz & Christopher Stanton, 2017. "Beyond Zeroes and Ones," Journal of Conflict Resolution, Peace Science Society (International), vol. 61(1), pages 56-83, January.
    18. Musayev, Vusal, 2014. "Commodity Price Shocks, Conflict and Growth: The Role of Institutional Quality and Political Violence," MPRA Paper 59786, University Library of Munich, Germany.
    19. Novta, Natalija & Pugacheva, Evgenia, 2021. "The macroeconomic costs of conflict," Journal of Macroeconomics, Elsevier, vol. 68(C).
    20. Giménez-Gómez, José-Manuel & Zergawu, Yitagesu-Zewdu, 2018. "The impact of social heterogeneity and commodity price shocks on civil conflicts," Journal of Policy Modeling, Elsevier, vol. 40(5), pages 959-997.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_12458. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Klaus Wohlrabe (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.