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Conflict, Ideology and Foreign Aid


  • Jean-Louis Arcand

    () (The Graduate Institute, Geneva)

  • Adama Bah

    () (CERDI Université d'Auvergne)

  • Julien Labonne

    () (University of Oxford)


In this paper, we present a rent-seeking model of conflict, which highlights the role of ideology in determining whether the government or the rebels take the initiative. We use the model to interpret the impact of a large-scale Community-Driven Development project on civil conflict in the Philippines. The country is characterized by the presence of two rebel groups, the New People's Army (NPA) and the Moro Islamic Liberation Front (MILF), with two distinct ideologies. We use a unique geo-referenced panel dataset on the occurrence of conflicts in 2003 and 2006 gathered from local newspapers that we match with nationally representative household survey and budget data on all municipalities in the country. Consistent with our model's predictions, using a variety of estimation strategies, we find robust evidence that the project leads to a decline in MILF-related events and to an increase in NPA-related events.

Suggested Citation

  • Jean-Louis Arcand & Adama Bah & Julien Labonne, 2010. "Conflict, Ideology and Foreign Aid," HiCN Working Papers 86, Households in Conflict Network.
  • Handle: RePEc:hic:wpaper:86

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    References listed on IDEAS

    1. de Ree, Joppe & Nillesen, Eleonora, 2009. "Aiding violence or peace? The impact of foreign aid on the risk of civil conflict in sub-Saharan Africa," Journal of Development Economics, Elsevier, vol. 88(2), pages 301-313, March.
    2. Barron, Patrick & Diprose, Rachael & Woolcock, Michael, 2007. "Local conflict and development projects in Indonesia : part of the problem or part of a solution ?," Policy Research Working Paper Series 4212, The World Bank.
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    1. repec:eee:wdevel:v:98:y:2017:i:c:p:506-522 is not listed on IDEAS
    2. Stijn van Weezel, 2017. "Mostly Harmless? A Subnational Analysis of the Aid-Conflict Nexus," Working Papers 201728, School of Economics, University College Dublin.

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    JEL classification:

    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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