A Theory of Civil Conflict and Democracy in Rentier States

A Theory of Civil Conflict and Democracy in Rentier States

25 Pages · 2006 · 163 KB · English

have a higher probability of being a dictatorship than other countries. Auty and Gelb . 1 Of course, if the groups that engage in civil conflict are not the same as those who may alternatively run in an election, a Fearon, J. D. and Laitin, D. (2003), Ethnicity, Insurgency, and Civil War, American

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1 A Theory of Civil Conflict and Democracy in Rentier States ∗ Silje Aslaksen and Ragnar Torvik Department of Economics Norwegian University of Science and Technology N7491 Trondheim NORWAY emails: [email protected] , [email protected] Abstract The effects of resource rents on the political equilibrium have been studied in two main types of models The first tradition employs models of conflict, and studies how resource rents affect the intensity and duration of civil conflict The second tradition employs political economy models, where resource rents affect the political equilibrium because the costs and benefits of buying votes change Although providing much insight, these traditions have little to say about when democracy emerges, and about when conflict emerges In this paper, by integrating the earlier model traditions, we suggest the simplest possible framework we can think of to study the choice between conflict and democracy We show how factors such as resource rents, the extent of electoral competition, and productivity affect economic and political equilibria Keywords: Political economy, Resource curse, Endogenous democratic institutions JEL classification codes: H1,D72, D74,Q32 ∗ We are grateful for comments from Fredrik Carlsen, Karl Ove Moene, Paivi Lujala, James A Robinson, associate editor Christian Schultz, an anonymous referee, and seminar participants at UC Berkeley, International Peace Research Institute Oslo (PRIO), the 2005 European Consortium for Political Research conference, and our own university 2 I Introduction One of the most studied empirical questions in the conflict and democracy literature over the last decade has been the connection between resource abundance and civil conflict According to Collier and Hoeffler (2000), “the extent of primary commodity exports is the largest single influence on the risk of conflict” (p 26) Damania and Bulte (2003) show that resource abundant countries are on average less democratic than resource poor countries Several empirical studies, for instance Elbadawi and Sambanis (2002) and Fearon and Laitin (2003), challenge the findings of the large literature initiated by Collier and Hoeffler, and conclude that a broad resource measure that includes all primary commodities does not have a robust association with civil conflict Many studies have, therefore, investigated which particular natural resources may contribute to conflict, and which do not For example, Ross (2001) finds that, after controlling for other factors, countries rich in oil have a higher probability of being a dictatorship than other countries Auty and Gelb (2001) likewise concludes that ’point resources’ such as minerals, have a particularly strong association with destabilizing social tension, while Murshed (2004) suggests that ‘point resources’ retard democratic and institutional development Similarly, de Soysa (2002) and Fearon and Laitin (2003) find that a dummy variable for oil exporters makes civil conflict more likely Lujala (2005) concludes that onshore oil production increases the probability of civil conflict, but that offshore production does not, and Lujala, Gleditsch and Gilmore (2005) suggest that secondary diamonds increase the likelihood of conflict In general, it seems fair to say that the results from the abundant empirical literature indicate that oil, gemstones, minerals and other ‘lootable’ resources are connected with civil conflict, but that there appears to be no similar effect of less lootable (and less valuable) resources such as agricultural land An overview of this empirical literature is provided by Ross (2004) 3 Theoretical studies of the effects of resource abundance on the political equilibrium can be divided into two

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