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

44 Pages Posted: 5 Oct 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: October 2016

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 as the inflows of refugees increase the size of their populations. The war has undermined progress towards deeper regional trade integration, thus adding to varying degrees to the direct costs sustained by the Levant economies and, in the cases of Syria and Iraq, doubling their welfare losses. All Levant countries are foregoing opportunities to expand intra‐Levant trade and the associated gains in economic efficiency. The average welfare effects are not indicative of the distributional effects of war within countries.

Suggested Citation

Ianchovichina, Elena and Ivanic, Maros, Economic Effects of the Syrian War and the Spread of the Islamic State on the Levant (October 2016). The World Economy, Vol. 39, Issue 10, pp. 1584-1627, 2016. Available at SSRN: https://ssrn.com/abstract=2847996 or http://dx.doi.org/10.1111/twec.12400

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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