On%20the%20Micro%2DFoundations%20of%20Contract%20versus%20Conflict%20with%20Implications%20for%20International%20Peace%2DMaking

Working Papers

On the Micro-Foundations of Contract versus Conflict with Implications for International Peace-Making


CODE: WP-644
AUTHOR(s): Cuesta, José , Mansoob Murshed, Syed
PUBLISHED: August 2008
LANGUAGE: English
RELATED TOPICS: Finance
DOWNLOAD FILE IN: English

Abstract:

This paper expands the micro-foundations of the traditional greed and grievance non-cooperative model of civil conflict between a government and a rebel group.First, the paper’s model allows for greed and grievance to be orthogonal, so that they may affect each other. Second, the model allows for the reaction curves of both parties in non-cooperative games to be substitutes and not inevitably complementary. Third, the paper allows for Diaspora transfers to rebel groups.Fourth, the paper expands external aid in the form of fungible financing of government transfers “buying” peace. These extensions provide a better understanding of conflict persistence, the consequences of competing international aid and why sub-optimal sanctions provision (“cheap talk”) by the international community are frequent.

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