IDEAS home Printed from https://ideas.repec.org/p/igi/igierp/609.html
   My bibliography  Save this paper

The Survival and Demise of the State: A Dynamic Theory of Secession

Author

Listed:
  • Joan Esteban
  • Sabine Flamand
  • Massimo Morelli
  • Dominic Rohner

Abstract

This paper describes the repeated interaction between groups in a country as a repeated Stackelberg bargaining game, where conflict and secessions can happen on the equilibrium path due to commitment problems. If a group out of power is sufficiently small and their contribution to total surplus is not too large, then the group in power can always maintain peace with an agreeable surplus sharing offer every period. When there is a mismatch between relative size and relative surplus contribution of the minority group, conflict can occur. While in the static model secession can occur only as peaceful outcome, in the infinite horizon game with high discount factor conflict followed by secession can occur. We discuss our full characterization of equilibrium outcomes in light of the available empirical evidence.

Suggested Citation

  • Joan Esteban & Sabine Flamand & Massimo Morelli & Dominic Rohner, 2017. "The Survival and Demise of the State: A Dynamic Theory of Secession," Working Papers 609, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  • Handle: RePEc:igi:igierp:609
    as

    Download full text from publisher

    File URL: ftp://ftp.igier.unibocconi.it/wp/2017/609.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. repec:cup:apsrev:v:107:y:2013:i:04:p:806-832_00 is not listed on IDEAS
    2. Joan Esteban & Massimo Morelli & Dominic Rohner, 2015. "Strategic Mass Killings," Journal of Political Economy, University of Chicago Press, vol. 123(5), pages 1087-1132.
    3. Samuel Bazzi & Matthew Gudgeon, 2017. "The Political Boundaries of Ethnic Divisions," Boston University - Department of Economics - Working Papers Series WP2018-005, Boston University - Department of Economics.
    4. Alberto Alesina & Enrico Spolaore, 1997. "On the Number and Size of Nations," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1027-1056.
    5. Enrico Spolaore & Alberto Alesina & Romain Wacziarg, 2000. "Economic Integration and Political Disintegration," American Economic Review, American Economic Association, vol. 90(5), pages 1276-1296, December.
    6. Sabine Flamand, 2015. "Interregional transfers, group loyalty and the decentralization of redistribution," Economics of Governance, Springer, vol. 16(4), pages 307-330, November.
    7. Morelli, Massimo & Rohner, Dominic, 2015. "Resource concentration and civil wars," Journal of Development Economics, Elsevier, vol. 117(C), pages 32-47.
    8. Goyal, Sanjeev & Staal, Klaas, 2004. "The political economy of regionalism," European Economic Review, Elsevier, vol. 48(3), pages 563-593, June.
    9. Bolton, Patrick & Roland, Gerard & Spolaore, Enrico, 1996. "Economic theories of the break-up and integration of nations," European Economic Review, Elsevier, vol. 40(3-5), pages 697-705, April.
    10. Patrick Bolton & Gérard Roland, 1997. "The Breakup of Nations: A Political Economy Analysis," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1057-1090.
    11. Haimanko, Ori & Le Breton, Michel & Weber, Shlomo, 2005. "Transfers in a polarized country: bridging the gap between efficiency and stability," Journal of Public Economics, Elsevier, vol. 89(7), pages 1277-1303, July.
    12. Arzaghi, Mohammad & Henderson, J. Vernon, 2005. "Why countries are fiscally decentralizing," Journal of Public Economics, Elsevier, vol. 89(7), pages 1157-1189, July.
    13. Alesina, Alberto & Spolaore, Enrico, 2005. "War, peace, and the size of countries," Journal of Public Economics, Elsevier, vol. 89(7), pages 1333-1354, July.
    14. Julian Wucherpfennig & Nils B. Weidmann & Luc Girardin & Lars-Erik Cederman & Andreas Wimmer, 2011. "Politically Relevant Ethnic Groups across Space and Time: Introducing the GeoEPR Dataset1," Conflict Management and Peace Science, Peace Science Society (International), vol. 28(5), pages 423-437, November.
    15. Michel Le Breton & Shlomo Weber, 2003. "The Art of Making Everybody Happy: How to Prevent a Secession," IMF Staff Papers, Palgrave Macmillan, vol. 50(3), pages 1-4.
    16. Dominic Rohner & Mathias Thoenig & Fabrizio Zilibotti, 2013. "War Signals: A Theory of Trade, Trust, and Conflict," Review of Economic Studies, Oxford University Press, vol. 80(3), pages 1114-1147.
    17. repec:wbk:wbpubs:26447 is not listed on IDEAS
    18. Bardhan, Pranab, 1997. "Method in the madness? a political-economy analysis of the ethnic conflicts in less developed countries," World Development, Elsevier, vol. 25(9), pages 1381-1398, September.
    19. repec:wly:econjl:v:128:y:2018:i:615:p:2933-2967 is not listed on IDEAS
    20. Vincent Anesi & Philippe De Donder, 2013. "Voting under the threat of secession: accommodation versus repression," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 41(2), pages 241-261, July.
    21. Bordignon, Massimo & Brusco, Sandro, 2001. "Optimal secession rules," European Economic Review, Elsevier, vol. 45(10), pages 1811-1834, December.
    22. Hannes Mueller & Dominic Rohner, 2018. "Can power-sharing foster peace? Evidence from Northern Ireland," Economic Policy, CEPR;CES;MSH, vol. 33(95), pages 447-484.
    23. Buchanan, James M & Faith, Roger L, 1987. "Secession and the Limits of Taxation: Toward a Theory of Internal Exit," American Economic Review, American Economic Association, vol. 77(5), pages 1023-1031, December.
    24. Guillem López Casasnovas & Joan Rosselló Villalonga, 2014. "Fiscal Imbalances in Asymmetric Federal Regimes. The Case of Spain," Hacienda Pública Española, IEF, vol. 209(2), pages 55-97, June.
    25. repec:sae:joupea:v:54:y:2017:i:3:p:365-381 is not listed on IDEAS
    26. 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.
    27. Olofsgard, Anders, 2003. "Incentives for secession in the presence of mobile ethnic groups," Journal of Public Economics, Elsevier, vol. 87(9-10), pages 2105-2128, September.
    28. Klaus Desmet & Michel Breton & Ignacio Ortuño-Ortín & Shlomo Weber, 2011. "The stability and breakup of nations: a quantitative analysis," Journal of Economic Growth, Springer, vol. 16(3), pages 183-213, September.
    29. Michael L. Ross, 2004. "What Do We Know about Natural Resources and Civil War?," Journal of Peace Research, Peace Research Institute Oslo, vol. 41(3), pages 337-356, May.
    30. J. Vernon Henderson & Adam Storeygard & David N. Weil, 2012. "Measuring Economic Growth from Outer Space," American Economic Review, American Economic Association, vol. 102(2), pages 994-1028, April.
    31. Ross, Michael L., 2004. "How Do Natural Resources Influence Civil War? Evidence from Thirteen Cases," International Organization, Cambridge University Press, vol. 58(01), pages 35-67, February.
    32. Donald Wittman, 2000. "The Wealth and Size of Nations," Journal of Conflict Resolution, Peace Science Society (International), vol. 44(6), pages 868-884, December.
    33. Friedman, David, 1977. "A Theory of the Size and Shape of Nations," Journal of Political Economy, University of Chicago Press, vol. 85(1), pages 59-77, February.
    34. Panizza, Ugo, 1999. "On the determinants of fiscal centralization: Theory and evidence," Journal of Public Economics, Elsevier, vol. 74(1), pages 97-139, October.
    35. repec:eee:jcecon:v:47:y:2019:i:1:p:50-64 is not listed on IDEAS
    36. repec:cup:apsrev:v:105:y:2011:i:03:p:478-495_00 is not listed on IDEAS
    37. Marvin Suesse, 2014. "Breaking the Unbreakable Union: Nationalism, Trade Disintegration and the Soviet Economic Collapse," Working Papers 0057, European Historical Economics Society (EHES).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dominic Rohner, 2018. "Success Factors for Peace Treaties: A Review of Theory and Evidence," Cahiers de Recherches Economiques du Département d'économie 18.08, Université de Lausanne, Faculté des HEC, Département d’économie.

    More about this item

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

    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:igi:igierp:609. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: http://www.igier.unibocconi.it/ .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.