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Financial Institutions, Religiosity, and Rebel Conflict in Islamic and Other States

Paper Session

Saturday, Jan. 4, 2020 2:30 PM - 4:30 PM (PDT)

Manchester Grand Hyatt, Cortez Hill B
Hosted By: Peace Science Society International
  • Chair: Carlos Seiglie, Rutgers University-Newark

Pioneering Firms in Fragile and Conflict-Affected States: Why and How Development Finance Institutions Should Support Them

Paul Collier
,
University of Oxford
Neil Gregory
,
World Bank
Alexandros Ragoussis
,
World Bank

Abstract

The role of first movers in fragile states is critical: they grow and diversify markets in ways that no other firms do, generating disproportionate impact in terms of development and stability. But pioneer firms are rare in fragile states. This study documents their profile, their challenges, and the barriers that prevent them from realizing their potential. The study also explores the rationale for development finance institutions to support them, and proposes new ways to offset costs, risks, and the "unknown unknowns" that generate radical uncertainty. Through a process of social learning and resetting negative self-fulfilling investor narratives, development finance institutions can help pioneering firms shift the growth trajectory of fragile and conflict-affected states.

Religiosity and Terrorism: Evidence from Ramadan Fasting

Roland Hodler
,
University of St. Gallen, University of Oxford, and CESifo
Paul Raschky
,
Monash University
Anthony Strittmatter
,
University of St. Gallen

Abstract

We study the effect of religion and intense religious experiences on terrorism by focusing on one of the five pillars of Islam: Ramadan fasting. For identification, we exploit two facts: First, daily fasting from dawn to sunset during Ramadan is considered mandatory for most Muslims. Second, the Islamic calendar is not synchronized with the solar cycle. We find a robust negative effect of more intense Ramadan fasting on terrorist events within districts and country-years in predominantly Muslim countries. This effect seems to operate partly through decreases in public support for terrorism and the operational capabilities of terrorist groups.

Combat, Casualties, and Compensation: Evidence from Iraq and Afghanistan

Laura Armey
,
Naval Postgraduate School
Thomas Kniesner
,
Claremont Graduate University
John Leeth
,
Bentley University
Ryan Sullivan
,
Naval Postgraduate School

Abstract

Our research examines the effect of combat deployments to Iraq and Afghanistan on casualties. We use restricted data from the Defense Manpower Data Center (DMDC) and Social Security Administration (SSA) to construct a panel of all U.S. Active Duty service members having served at some point during the years 2001-2012. Casualties disproportionately occur at higher rates among (i) young, white, males (ii) enlisted personnel (iii) less educated personnel (iv) and those in combat job types. Our estimates indicate that overall U.S. military personnel who deployed in an individual year to Iraq or Afghanistan had a 48 per 100,000 higher probability of death than non-deployed military personnel who remained stateside. The increased fatal injury risk of deployed U.S. military personnel is 15 times higher than the national average civilian workplace fatality rate, but roughly equal to the fatal injury risk faced in some of the most dangerous civilian occupations. Our estimates suggest a compensating wage differential equal to $808 per month would be appropriate, in comparison to the current status quo of $225 per month in danger pay (and additional tax benefits) provided to U.S. military personnel deployed into combat zones. The additional compensation should also be adjusted by service or job type.

Rebel Capacity and Combat Tactics

Konstantin Sonin
,
University of Chicago
Jarnickae Wilson
,
University of Chicago
Austin Wright
,
University of Chicago

Abstract

Both classic and modern theories of rebel warfare emphasize the role of unexpected attacks against better equipped and larger government forces. We test empirical implications of a simple model of combat and information-gathering using highly detailed information about Afghan rebel attacks, military base infiltration, insurgent-led spy networks, and counterinsurgent operations. As rebels gather more resources, their attacks become temporally concentrated: a one standard deviation increase in opium revenue leads to a .3 standard deviation increase in temporal clustering of rebel attacks. In contrast, following abnormal battlefield losses (labor scarcity), the timing of insurgent attacks becomes less concentrated: a one standard deviation increase in labor scarcity increases randomization of attack timing by .12 standard deviations. We supplement our benchmark specification with a novel instrumental variables (IV) approach that uses high resolution data on agronomic inputs and dimensionality reduction to instrument for opium suitability. We use LASSO and sample randomization tests to assess and confirm the validity of our IV approach. The main effect is significantly enhanced in areas where rebels have the capacity to spy on and infiltrate military installations. We use proprietary military surveys to estimate exposure to informal taxation by government officials, which shows that relatively lower reservation wages lead to larger revenue effects. We find evidence that rebels exhaust their resources during the fighting season after taxation.
Discussant(s)
Tirthatanmoy Das
,
Indian Institute of Management Bangalore and IZA
Leila Salarpour Goodarzi
,
Binghamton University
Curtis Simon
,
Clemson University
John Devereux
,
City University of New York
JEL Classifications
  • F5 - International Relations, National Security, and International Political Economy