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Social Composition, Social Conflict, and Economic Development

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  • Holger Strulik

    (Department of Economics, University of Copenhagen)

Abstract

This paper investigates how social composition affects social conflict and economic development when property rights are unenforceable. Groups follow Markovian strategies for consumption and investment and may also spend effort in an resource appropriation contest. It is shown that conflict prevents investment and growth in a society of symmetric groups. In a society at peace economic growth may occur. Growth, however, is decreasing in the degree of social fractionalization and smaller than it could be under secure property rights. In an economy populated by social groups of unequal size an asymmetric equilibrium exists. A large majority may behave peacefully although continuously challenged by a predatory minority. The rebelridden economy either stagnates or grows at a low rate. Growth is decreasing in the size of the predatory minority and its conflict intensity. A final part extends the analysis towards behavior of non-benevolent social elites.

Suggested Citation

  • Holger Strulik, 2005. "Social Composition, Social Conflict, and Economic Development," Discussion Papers 05-16, University of Copenhagen. Department of Economics.
    • Handle: RePEc:kud:kuiedp:0516
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    2. Rohner, Dominic, 2011. "Reputation, group structure and social tensions," Journal of Development Economics, Elsevier, vol. 96(2), pages 188-199, November.
    3. John Smith, 2012. "Reputation, Social Identity and Social Conflict," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(4), pages 677-709, August.
    4. Soares, Helena & Sequeira, Tiago Neves & Marques, Pedro Macias & Gomes, Orlando & Ferreira-Lopes, Alexandra, 2018. "Social infrastructure and the preservation of physical capital: Equilibria and transitional dynamics," Applied Mathematics and Computation, Elsevier, vol. 321(C), pages 614-632.
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    7. Schäfer, Andreas & Steger, Thomas, 2013. "Distributional conflict in small open economies," Research in Economics, Elsevier, vol. 67(4), pages 355-367.
    8. Strulik, Holger, 2012. "Poverty, voracity, and growth," Journal of Development Economics, Elsevier, vol. 97(2), pages 396-403.
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    More about this item

    Keywords

    social conflict; social fractionalization; property rights; stagnation; growth;
    All these keywords.

    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
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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