Consequences of Terrorism and Conflict
Paper Session
Sunday, Jan. 7, 2024 8:00 AM - 10:00 AM (CST)
- Chair: Solomon Polachek, SUNY-Binghamton
Macroeconomic Shocks and Conflict: Evidence from Commodity Terms-of-Trade Shocks
Abstract
We analyze the causal effect of aggregate income changes on the incidence of violent conflicts by exploiting a country’s commodity terms-of-trade (ToT) as a source of exogenous income variation. Based on a sample of 133 low- and middle-income countries over 30 years, we find that a negative commodity ToT shock leads to a significant and persistent increase in conflicts. The magnitude is twice as large for low-income countries compared to the sample average. Our results also show that the shocks create more violence in countries with higher inequality and stronger financial constraints on the government. Furthermore, there is a second-round effect through spillovers to neighboring countries. Along with the previous studies that emphasize the economic cost of conflicts, our empirical results imply the presence of a vicious feedback loop between weak economic performance and conflicts.Education and Military Expenditures: Countervailing Forces in Designing Economic Policy, A Contribution to the Empirics of Peace
Abstract
Abstract: This paper contributes to the empirical analysis of social peace, specifically aiming to assess the suitability of an economic policy instrument for the maintenance of social peace. The contention advanced in this paper is that identifying the ratio of public education investment to military expenditure (hereafter referred to as Edumilex) serves as a pertinent instrument for fostering peaceful economic policies. To empirically evaluate this instrument, we employ a target variable serving as a measure of internal peace, structured as a concise metric of positive peace based on four pillars: (i) Health; (ii) Standard of living; (iii) Quality of institutions; (iv) Spread of violence. In the construction of this metric, inspiration was drawn from the Collier-Hoeffler greed/grievance models and the Human Development Index (HDI). More precisely, we empirically estimate the impact of Edumilex on social peace, utilizing a panel comprising 85 countries spanning the years from 1990 to 2020. We utilize an Instrumental Variable approach. In particular, in the baseline estimation we employ an IV/GMM estimator. The robust and positive relationship identified in our analysis suggests the viability of Edumilex as an instrument of economic policy. This proposition constitutes a noteworthy innovation since governments commonly perceive education and military spending as distinct policy domains. However, in the light of this work, such a perspective appears flawed, as these factors both exert influence on the levels of peace within a society.British Voting Intentions and the Far Reach of 11 September Terrorist Attacks in New York
Abstract
Terrorist attacks have often been found to impact voting behaviours in the country of theattack. Here I study the impact of 9/11 terrorist attacks in New-York on voting preferences in
the UK, concluding that 9/11 impacted the voting intentions of the British, significantly
increasing prospective votes for the Conservative party and reducing future votes for the
Labour, the incumbent party at the time. Using daily survey data on voting intentions of a
representative sample of several thousands of Brits in the days before and after the 9/11
attack, taking a Regression Discontinuity Design and Event Study approach, reveals an
immediate large increase by about 31% in intentions to vote for the Conservative party and a
decline of 17% in prospective Labour votes at future elections. These findings are robust to
several checks, with the effect being short-lived, and varying largely depending on previous
voting decisions, as well as by gender, education and employment status.
Discussant(s)
Md Shahadath Hossain
,
University of Houston
Carlos Seiglie
,
Rutgers University
Elisa Taveras Pena
,
University of Texas-Rio Grande Valley
John Devereux
,
CUNY-Queens College
JEL Classifications
- F5 - International Relations, National Security, and International Political Economy
- H5 - National Government Expenditures and Related Policies