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An Economic Approach to Analyzing Civil War

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  • Stergios Skaperdas

    (Department of Economics, University of California-Irvine)

Abstract

Civil wars and conflict can be understood from an economic point of view only if there is incomplete contracting. I examine such settings and first discuss sources of incomplete contracting, from geography and ethnic and social distance to external interventions due to geopolitics or the presence of rents. Yet, since war is destructive, the contending parties might normally be expected to settle in the shadow of war. One reason that sometimes they do not, contrary to conventional wisdom, is because the shadow of the future is too long. Subsequently, using a formal model for guidance I examine some consequences of civil wars and emphasize the role hierarchical organization and rents play in determining the severity of conflict.

Suggested Citation

  • Stergios Skaperdas, 2007. "An Economic Approach to Analyzing Civil War," Working Papers 060715, University of California-Irvine, Department of Economics.
    • Handle: RePEc:irv:wpaper:060715
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    Cited by:

    1. Stergios Skaperdas, 2011. "Proprietary Public Finance: On its Emergence and Evolution out of Anarchy," CESifo Working Paper Series 3495, CESifo.
    2. Christopher Blattman, 2009. "Civil War: A Review of Fifty Years of Research," Working Papers id:2231, eSocialSciences.
    3. Adeel Malik & Rinchan Ali Mirza & Faiz Ur Rehman, 2023. "Frontier governmentality," WIDER Working Paper Series wp-2023-42, World Institute for Development Economic Research (UNU-WIDER).
    4. Tridimas, George, 2011. "The political economy of power-sharing," European Journal of Political Economy, Elsevier, vol. 27(2), pages 328-342, June.
    5. Stefano Battilossi & Stefan O. Houpt, 2009. "Predicting institutional collapse: stock markets, political violence and the Spanish Civil War, 1920-36," Working Papers 9002, Economic History Society.
    6. Libman, Alexander Mikhailovich, 2009. "Эндогенные Границы И Распределение Власти В Федерациях И Международных Сообществах [ENDOGENOUS BOUNDARIES AND DISTRIBUTION OF POWER In the Federation]," MPRA Paper 16473, University Library of Munich, Germany.
    7. Atin Basuchoudhary, 2021. "Why Is Civil Conflict Path Dependent? A Cultural Explanation," Games, MDPI, vol. 12(4), pages 1-12, December.
    8. Bouoiyour, Jamal & Selmi, Refk & Hammoudeh, Shawkat & Wohar, Mark E., 2019. "What are the categories of geopolitical risks that could drive oil prices higher? Acts or threats?," Energy Economics, Elsevier, vol. 84(C).
    9. Michael McBride & Stergios Skaperdas, 2005. "Explaining Conflict in Low-Income Countries: Incomplete Contracting in the Shadow of the Future," CESifo Working Paper Series 1636, CESifo.
    10. Shinde, Nilesh N. & Do Valle, Stella Z. Schons & Maia, Alexandre Gori & Amacher, Gregory S., 2022. "Can an environmental policy contribute to the reduction of land conflict? Evidence from the Rural Environmental Registry (CAR) in the Brazilian Amazon," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322584, Agricultural and Applied Economics Association.
    11. Christopher Blattman & Edward Miguel, 2010. "Civil War," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 3-57, March.
    12. Noguera-Santaella, José, 2016. "Geopolitics and the oil price," Economic Modelling, Elsevier, vol. 52(PB), pages 301-309.
    13. Alexandros Apostolides & Michalis Zaouras & Alexis Antoniou, 2017. "Nationalism, policing and inequality: Understanding outbursts of violence using the 1931 Cyprus riots," Working Papers 17018, Economic History Society.
    14. Baten, Joerg & Mumme, Christina, 2013. "Does inequality lead to civil wars? A global long-term study using anthropometric indicators (1816–1999)," European Journal of Political Economy, Elsevier, vol. 32(C), pages 56-79.
    15. Alsagr, Naif & Cumming, Douglas J. & Davis, Justin G. & Sewaid, Ahmed, 2023. "Geopolitical risk and crowdfunding performance," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 85(C).
    16. Ahmed Mahmud & Juan Vargas, 2011. "Combatant recruitment and the outcome of war," Economics of Governance, Springer, vol. 12(1), pages 51-74, March.
    17. Adeel Malik & Rinchan Ali Mirza & Faiz Ur Rehman, 2023. "Frontier rule and conflict," WIDER Working Paper Series wp-2023-128, World Institute for Development Economic Research (UNU-WIDER).
    18. Horatiu Rus, 2014. "Corruption, conflict and the management of natural resources," Economics of Governance, Springer, vol. 15(4), pages 355-386, November.

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    More about this item

    Keywords

    Warlords; Incomplete contracting; Conflict; Appropriation; Anarchy; Shadow of the future;
    All these keywords.

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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