Security, Trade, and Political Violence

60 Pages Posted: 19 Jun 2017 Last revised: 29 Sep 2022

See all articles by Francesco Amodio

Francesco Amodio

Universitat Pompeu Fabra

Leonardo Baccini

McGill University

Michele Di Maio

Sapienza University of Rome

Abstract

To address security concerns, governments often implement trade barriers and restrictions on the movement of goods and people. These restrictions have negative economic consequences, possibly increasing the supply of political violence. To test this hypothesis, we exploit the restrictions imposed by Israel on imports to the West Bank as a quasi-experiment. In 2008 Israel started enforcing severe restrictions on the import of selected dual-use goods and materials, de facto banning a number of production inputs from entering the West Bank. We show that after 2008 (i) output and wages decrease in those manufacturing sectors that use those materials more intensively as production inputs, (ii) wages decrease in those localities where employment is more concentrated in these sectors, and (iii) episodes of political violence are more likely to occur in these localities. Our calculations suggest these effects account for 18% of the violent political events that occurred in the West Bank from 2008 to 2014.

Keywords: political violence, trade, security

JEL Classification: D22, D24, F51, N45, O12

Suggested Citation

Amodio, Francesco and Baccini, Leonardo and Di Maio, Michele, Security, Trade, and Political Violence. IZA Discussion Paper No. 10819, Available at SSRN: https://ssrn.com/abstract=2988166

Francesco Amodio (Contact Author)

Universitat Pompeu Fabra ( email )

Ramon Trias Fargas, 25-27
Barcelona, 08005
Spain

HOME PAGE: http://sites.google.com/site/fscoamodio

Leonardo Baccini

McGill University ( email )

1001 Sherbrooke St. W
Montreal, Quebec H3A 1G5
Canada

Michele Di Maio

Sapienza University of Rome ( email )

via del Castro Laurenziano 9
Rome
Italy

HOME PAGE: http://https://sites.google.com/a/uniroma1.it/micheledimaio/home

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