Violent Conflict and Inequality

37 Pages Posted: 29 Jun 2010

See all articles by Cagatay Bircan

Cagatay Bircan

European Bank for Reconstruction and Development (EBRD)

Tilman Brück

IGZ - Leibniz Institute of Vegetable and Ornamental Crops; ISDC - International Security and Development Center; IZA Institute of Labor Economics

Marc Vothknecht

affiliation not provided to SSRN

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Abstract

This paper analyzes the distributive impacts of violent conflicts, which is in contrast to previous literature that has focused on the other direction. We use cross-country panel data for the time period 1960-2005 to estimate war-related changes in income inequality. Our results indicate rising levels of inequality during war and especially in the early period of post-war reconstruction. However, we find that this rise in income inequality is not permanent. While inequality peaks around five years after the end of a conflict, it declines again to pre-war levels within the end of the first post-war period. Lagged effects of conflict and only subsequent adjustments of redistributive policies in the period of post-war reconstruction seem to be valid explanations for these patterns of inequality. A series of alternative specifications confirms the main findings of the analysis.

Keywords: conflict, war, inequality, reconstruction, income distribution

JEL Classification: O11, O15

Suggested Citation

Bircan, Cagatay and Brück, Tilman and Vothknecht, Marc, Violent Conflict and Inequality. IZA Discussion Paper No. 4990, Available at SSRN: https://ssrn.com/abstract=1631125 or http://dx.doi.org/10.2139/ssrn.1631125

Cagatay Bircan (Contact Author)

European Bank for Reconstruction and Development (EBRD) ( email )

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Tilman Brück

IGZ - Leibniz Institute of Vegetable and Ornamental Crops ( email )

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Grossbeeren, 14979
Germany

HOME PAGE: http://www.igzev.de

ISDC - International Security and Development Center ( email )

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HOME PAGE: http://www.isd-center.org

IZA Institute of Labor Economics

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Bonn, D-53072
Germany

Marc Vothknecht

affiliation not provided to SSRN ( email )

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