poltical economy

• Objective


  Understand the economic factors that influence, result from, and are transformed by war
• Importance


  Economic analysis helps predict potential conflicts, manage wartime economies, and plan post-war recovery
• War are costly both in human terms and economically, but also a threat to the social structure of societies
• Greed


  Pursuit of wealth or economic gain by groups or individuals, particularly through the control of valuable resources such as minerals, oil, or fertile land
• Grievance


  Inequality, discrimination, or political exclusion, which may drive groups to conflict as a means of achieving a reform
• Greed as a motivation for War


  • Sierra Leone and diamonds: Rebel groups, such as the Revolutionary United Front, funded their military campaigns through diamond mining
  • Middle East oil conflicts: Control over oil-rich regions has been a significant factor in numerous conflicts in the Middle East
  • Colombian oil and coffee: Price drops in the 1990s increased violence in municipalities cultivating coffee (Dube & Vargas, 2013)
• Grievance as a motivation for war

  • Rwanda's genocide: Ethnic tensions and historical grievances between the Hutu and Tutsi populations escalated into genocide
  • Arab Spring: Widespread protests and conflicts were driven by grievances over corruption, inequality, and lack of political freedom
• Rapacity effect


  Increasing returns to appropriation increases conflict
• Negative relation between coffee price and conflict

  Labor intensive production: when price of coffee rises, the opportunity cost effect is larger the rapacity effect - reduction in conflict
• Positive relation between oil price and conflict

  High margin production: when price of oil rises, the gain from appropriation (rapacity effect) is larger than the opportunity cost effect - increase in conflict
• Significant and lasting impact of wars on trade flows
• Trade often not returning to pre-war levels even years after conflict ends
• Mediation

  A vital tool for peace negotiations, ranging from non-militarized discussions to direct negotiations
• Manipulative mediation

  Mediator plays a highly proactive role, using specific tactics or leverage to influence the outcome - pressure on parties, incentives for compliance, or even imposing sanctions for non-cooperation
• Military peacekeeping

  Military interventions, particularly peacekeeping operations, are essential for maintaining peace post-conflict
• Economic Interventions and recovery

  Economic stability is key to preventing the recurrence of conflicts. Interventions that focus on human capital and infrastructure development are crucial
• Successful conflict resolution requires a holistic approach combining mediation, military presence, and economic redevelopment