Economic Effects of the Syrian War and the Spread of the Islamic State on the Levant

41 Pages Posted: 20 Apr 2016

See all articles by Elena Ianchovichina

Elena Ianchovichina

World Bank

Maros Ivanic

World Bank; World Bank - Development Economics Group (DEC); World Bank - Development Research Group (DECRG)

Multiple version iconThere are 2 versions of this paper

Date Written: December 1, 2014

Abstract

This paper uses a global computable general-equilibrium framework with new detail on six Levant countries -- the Arab Republic of Egypt, Iraq, Jordan, Lebanon, the Syrian Arab Republic, and Turkey -- to quantify the direct and indirect economic effects of the Syrian war and the advance of the Islamic State on the Levant. Syria and Iraq bear the brunt of the direct economic costs, while the other Levant countries lose in per capita but not in aggregate terms. The fact that the Islamic State's spread has undermined regional trade adds to varying degrees to the direct costs in all Levant economies and in the case of Syria and Iraq doubles the welfare losses. All these countries are foregoing opportunities to expand intra-Levant trade and the associated gains in economic efficiency and diversification. The average welfare effects are not indicative of within-country incidence, which varies among workers, landowners, and capitalists.

Keywords: Conflict and Fragile States, International Trade and Trade Rules, Economic Theory & Research, Economic Growth, Industrial Economics

Suggested Citation

Ianchovichina, Elena and Ivanic, Maros, Economic Effects of the Syrian War and the Spread of the Islamic State on the Levant (December 1, 2014). World Bank Policy Research Working Paper No. 7135. Available at SSRN: https://ssrn.com/abstract=2535615

Elena Ianchovichina (Contact Author)

World Bank ( email )

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Maros Ivanic

World Bank ( email )

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World Bank - Development Economics Group (DEC) ( email )

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World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

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