Working Paper: CEPR ID: DP6659
Authors: Philippe Martin; Thierry Mayer; Mathias Thoenig
Abstract: This paper analyzes empirically the relationship between civil wars and international trade. We first show that trade destruction due to civil wars is very large and persistent and increases with the severity of the conflict. We then test the presence of two effects that trade can have on the risk of civil conflicts: it may act as a deterrent if trade gains are put at risk during civil wars but it may also act as an insurance if international trade provides a substitute to internal trade during civil wars. We find support for the presence of these two mechanisms and conclude that trade openness may deter the most severe civil wars (those that destroy the largest amount of trade) but may increase the risk of lower scale conflicts.
Keywords: civil war; globalization; trade
JEL Codes: F10; F51; F52; F59
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| risk of low-intensity civil wars (D74) | internal trade during civil wars (F19) |
| trade openness (F43) | risk of high-intensity civil wars (D74) |
| trade openness (F43) | risk of low-intensity civil wars (D74) |
| civil wars (D74) | international trade (F19) |
| trade openness (F43) | destruction of trade due to civil wars (N93) |