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Civil War in a Globalized World: Diplomacy and Trade

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  • Mathieu Couttenier
  • Raphael Soubeyran

Abstract

We consider the impact of diplomatic intervention in civil wars on international trade. Using a large data set over the period 1948-2005, we obtain two striking results: (i) diplomatic intervention has a positive effect on trade for the country in which the civil war occurs (target country); and (ii) bilateral trade between the target and intervening country does not increase more than trade between the target country and the other countries. We argue that intervention induces an enhancement of trade-promoting capital in the target country and show that diplomatic intervention has a positive effect on institutional quality in the target country.

Suggested Citation

  • Mathieu Couttenier & Raphael Soubeyran, 2010. "Civil War in a Globalized World: Diplomacy and Trade," Working Papers 10-02, LAMETA, Universtiy of Montpellier, revised Feb 2010.
    • Handle: RePEc:lam:wpaper:10-02
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    References listed on IDEAS

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    Cited by:

    1. Mathieu COUTTENIER & Raphael SOUBEYRAN, 2011. "Diplomatic Intervention in Civil War : Trade for All or Trade for One?," Working Papers 11-08, LAMETA, Universtiy of Montpellier, revised Apr 2011.

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