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Violent Conflict and Inequality

38 Pages Posted: 15 Jul 2010  

Cagatay Bircan

European Bank for Reconstruction and Development

Tilman Brück

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

Marc Vothknecht

German Institute for Economic Research (DIW Berlin)

Multiple version iconThere are 2 versions of this paper

Date Written: June 2010

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, Inequality, Reconstruction, Income Distribution

JEL Classification: O11, O15

Suggested Citation

Bircan, Cagatay and Brück, Tilman and Vothknecht, Marc, Violent Conflict and Inequality (June 2010). DIW Berlin Discussion Paper No. 1013. Available at SSRN: https://ssrn.com/abstract=1639826 or http://dx.doi.org/10.2139/ssrn.1639826

Cagatay Bircan

European Bank for Reconstruction and Development ( email )

One Exchange Square
London, EC2A 2JN
United Kingdom
+442073388508 (Phone)
+442073386111 (Fax)

HOME PAGE: http://www.ebrd.com/pages/research/economics/researchers/cagatay-bircan.shtml

Tilman Brück

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

Theodor-Echtermeyer-Str. 1
Grossbeeren, 14979
Germany

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

ISDC - International Security and Development Center ( email )

Friedrichstr. 88
Berlin, 10117
Germany

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

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Marc Vothknecht (Contact Author)

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

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