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Civil Wars and International Trade

Author

Listed:
  • Philippe Martin

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)

  • Thierry Mayer

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)

  • Mathias Thoenig

    (CUI - Centre Universitaire d'Informatique - UNIGE - Université de Genève = University of Geneva)

Abstract

This paper analyzes empirically the relationship between civil wars and international trade. We first show that trade destruction due to civil wars is very large and persistent and increases with the severity of the conflict. We then identify two effects that trade can have on the risk of civil conflicts: it may act as a deterrent if trade gains are put at risk during civil wars but it may also act as an insurance if international trade provides a substitute to internal trade during civil wars. We find support for the presence of these two mechanisms and conclude that trade openness may deter the most severe civil wars (those that destroy the largest amount of trade) but may increase the risk of lower scale conflicts.

Suggested Citation

  • Philippe Martin & Thierry Mayer & Mathias Thoenig, 2008. "Civil Wars and International Trade," Sciences Po Economics Publications (main) hal-01022359, HAL.
    • Handle: RePEc:hal:spmain:hal-01022359
    DOI: 10.1162/JEEA.2008.6.2-3.541
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-01022359
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    References listed on IDEAS

    as
    1. James E. Anderson & Eric van Wincoop, 2004. "Trade Costs," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 691-751, September.
    2. Paul Collier & Dominic Rohner, 2008. "Democracy, Development, and Conflict," Journal of the European Economic Association, MIT Press, vol. 6(2-3), pages 531-540, 04-05.
    3. John Romalis, 2007. "NAFTA's and CUSFTA's Impact on International Trade," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 416-435, August.
    4. Philippe Martin & Thierry Mayer & Mathias Thoenig, 2008. "Make Trade Not War?," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 75(3), pages 865-900.
    5. Philippe Martin & Thierry Mayer & Mathias Thoenig, 2008. "Make Trade Not War?," Review of Economic Studies, Oxford University Press, vol. 75(3), pages 865-900.
    6. S. Brock Blomberg & Gregory D. Hess, 2006. "How Much Does Violence Tax Trade?," The Review of Economics and Statistics, MIT Press, vol. 88(4), pages 599-612, November.
    7. Kristian Gleditsch, 2004. "A Revised List of Wars Between and Within Independent States, 1816-2002," International Interactions, Taylor & Francis Journals, vol. 30(3), pages 231-262, July.
    8. Paul Collier & Anke Hoeffler & Dominic Rohner, 2009. "Beyond greed and grievance: feasibility and civil war," Oxford Economic Papers, Oxford University Press, vol. 61(1), pages 1-27, January.
    9. Baier, Scott L. & Bergstrand, Jeffrey H., 2004. "Economic determinants of free trade agreements," Journal of International Economics, Elsevier, vol. 64(1), pages 29-63, October.
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    More about this item

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • F52 - International Economics - - International Relations, National Security, and International Political Economy - - - National Security; Economic Nationalism
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other

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