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USAID Workshop on
Conflict Prevention Management
>> USAID Home >> Conflict Prevention >> June 2000 Workshop SESSION IV: ECONOMIC GROWTH AND CONFLICT
"The Economics of Civil Wars, Crime, and Violence"Dr. Paul Collier, Director, Development Economics and Conflict Research Group,
The World Bank
June 7, 2000
Click here to hear an audio clip from this speech.
What are the causes of conflict? Causes are more than just interesting and independent variables. They give us some ability to predict conflict. They also give us an idea of what the postconflict environment will resemble. Postconflict societies also have problems stemming from the nature of the conflict itself. The basis of the Bank's Conflict Research Group work is empirical. The resulting model, to be outlined here, has been successful in predicting conflict. In 1995, the model successfully predicted a descent into conflict in Zaïre.
How do we define risk? The following table, which compares two imaginary countries, illustrates just how different our basic definition of risk is from more traditional interpretations.
COUNTRY A COUNTRY B Inequality low high Political rights good poor Ethnic Composition same diverse Religious Composition same diverse RISK X Put simply, classic assumptions about rights and population diversity donothold up empirically.
There are three key concepts to the model. First, a "conflict trap" comes into play.
In a conflict trap, the experience of the conflict itself feeds back to cause additional components of the conflict. This is a major underlying risk once a country engages in conflict. Roughly half the countries examined in the study have fallen back into conflict.
Secondly, grievances are both objective or subjective, but for a rebel group to generate conflict, it must generate and maintain grievances to motivate its members.
Many organizations have grievances. Grievances exist everywhere. The Michigan militia has grievances. In order to succeed, however, rebel organizations must effectively create and maintain a high level of grievances within their ranks.
Thirdly, there are three constraints to building a viable rebel organization.
In ethnically diverse societies, cohesion is a critical component to a rebel organization. Organizations are almost always made up of people from the same group. Hatred itself, whether ethnic hatred or other forms of hatred, does not provide a explanation for conflict. The inverse, in fact, was true; conflict makes hatred.
What are the major risk factors for conflict?
- Dependence on primary commodity exports.The risk increases 46 fold when a country relies on a primary commodity export. A rebel organization must first ensure a finaincial source. In the post-Cold War world, successful rebel organizations get resources from taxes on primary commodities.
- Economic growth. Faster growth reduces risk. A one percent growth rate lessens risk by one percent.
- Secondary education. A 10 percent enrollment rate reduced risk of conflict by 4 percent.
Other potential risk factors were shown to have less importance. Compared to the importance of primary commodities, ethnic dominance is trivial as a risk factor. A country's risk only doubles when ethnically diverse, whereas the existence of a primary commodity raises the risk 46 fold. Two other factors, geographic dispersion and mountainous terrain, do increase risk, but not as much as one might be led to believe. Inequality and political repression were proved to be remarkably unimportant factors in conflict.
How can aid policy make a difference?
Routes to Conflict Prevention
Well-planned aid helps in two ways, by leading to faster growth but also by reducing a country's dependency on primary commodity exports. As the chart below indicates, a country's policy works in exactly the same way as aid, by leading to growth and reducing dependency on primary commodity exports.
Good policy makes aid more effective. Moreover, good policy combined with well-planned aid can reduce the conflict risk rate by 30 percent. Without the right policies, though, aid can do little. Many of the countries examined had such bad policies that aid did little. Other countries were so totally dependent on primary exports that aid and policy could not reduce the risk enough.
Thepostconflictsetting adds more complicated layers to conflict prevention and risk assessment. The "conflict trap" (or feedback loop) which occurs once a country has descended into conflict is encumbered by additional risk factors. While not definitive, there are several possible reasons for this. First, there are always conflict-specific assets to any war. Some actors do well economically from war. Second, there are conflict-specific organizations and institutions that also have an interest in continuing war. Third, conflict itself introduces norms of violence. While political conflict usually has no connection to violence, the norms have shifted in postconflict societies. Fourth, fear increases dramatically in postconflict environments. In a polarized society, pre-emptive violence makes sense when fear is a driving motive. Fifth, grievances increase in a postconflict country. These can be both objective and subjective grievances. Sixth, polarization increases, often in the form of one quasi-ethnic group dominating another. In Zaïre, for example, many ethnic groups banded together into two large and opposed groups.
Statistically, though, there is one major factor that massively increases the risk of renewed conflict:diasporasbased in the US. Not only do they provide an important source of financing for rebel organizations, but they can also encourage a persistence of grievances, even if the environment has changed in the home country.
Several points can be emphasized in conclusion. First, whether or not a country depends on a primary commodity for export is of seminal importance. Second, a diaspora can be critical to the continuation or recurrence of conflict. While democracy and governance are good development goals in themselves, they are not effective tools for conflict prevention. Strengthening them will not reduce the risks of conflict.
Transcription of audio clip: "When we formulate policy to conflict reduction of producing the risk of conflict our discourse is overwhelmingly driven at the moment by very good things: democracy, governance, inequality, all of these things are thoroughly good, very powerful reasons why we should try and achieve them. But they will not, I think, significantly reduce the risk of conflict. And it will be tragic if societies go through it -- and still have this very high incidence of conflict. Most of the low income countries have experienced conflict and have a very high risk of conflict. You've got to do something about it."
[This audio clip requires RealPlayerTM.The RealPlayer software is available for free download from RealNetwork at http://www.real.com/player/index.html.]
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