Aid and conflict at the subnational level – Evidence from World Bank and Chinese development projects in Africa

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See all articles by Kai Gehring

Kai Gehring

University of Zurich - Chair of Political Economy; Heidelberg University

Lennart C. Kaplan

University of Goettingen (Gottingen)

Melvin H.L. Wong

Leibniz Universität Hannover - Faculty of Economics and Management

Date Written: November 28, 2018

Abstract

Using geo-referenced data on development projects by the World Bank and China, we provide a
comprehensive analysis of the effect of aid on conflict using fixed effects and instrumental variables
strategies. The results show that aid projects seem to reduce rather than fuel conflict, on average.
Our analysis suggests that this is driven by projects in the transport and financial sectors, and
through less lethal violence by governments against civilians. There are no clear differences
based on ethnic fractionalization and government affiliation of a region, but some indications of
spill-overs to other regions. We also find no increased likelihood of demonstrations, strikes or
riots, but a higher likelihood of non-lethal government repression in areas where China is active.

Keywords: Development Aid, Conflict, Repression, Geolocation, World Bank, China, Africa

JEL Classification: H77, N9

Suggested Citation

Gehring, Kai and Kaplan, Lennart C. and Wong, Melvin H.L., Aid and conflict at the subnational level – Evidence from World Bank and Chinese development projects in Africa (November 28, 2018). Available at SSRN: https://ssrn.com/abstract=

Kai Gehring (Contact Author)

University of Zurich - Chair of Political Economy ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland
+4917620916056 (Phone)

HOME PAGE: http://www.kai-gehring.net

Heidelberg University ( email )

Grabengasse 1
Heidelberg, 69117
Germany

Lennart C. Kaplan

University of Goettingen (Gottingen) ( email )

Platz der Gottinger Sieben 3
Gottingen, D-37073
Germany

Melvin H.L. Wong

Leibniz Universität Hannover - Faculty of Economics and Management ( email )

Koenigsworther Platz 1
Hannover, 30167
Germany

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