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Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia

The “Resource Curse” posits a positive association between the value of natural commodities and civil conflict. In this paper, we suggest that the value-to-violence relationship differs across commodities, and that the factor intensity of production determines whether a rise in the price of a legall...

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Detalles Bibliográficos
Autores Principales: Vargas, Juan F., Dube, Oeindrila
Formato: Preimpresión (Preprint)
Lenguaje:Inglés (English)
Publicado: Harvard University 2006
Materias:
Colombia
Civil War
Resource Curse
Difference-in-Differences
Acceso en línea:https://repository.urosario.edu.co/handle/10336/29846
id ir-10336-29846
recordtype dspace
spelling ir-10336-298462022-07-13T08:03:38Z Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia ¿Están malditos todos los recursos? Café, petróleo y conflicto armado en Colombia Vargas, Juan F. Dube, Oeindrila Colombia Civil War Resource Curse Difference-in-Differences The “Resource Curse” posits a positive association between the value of natural commodities and civil conflict. In this paper, we suggest that the value-to-violence relationship differs across commodities, and that the factor intensity of production determines whether a rise in the price of a legally traded good will exacerbate conflict. We exploit exogenous price shocks for coffee and oil to test this hypothesis, using data on politically-motivated violence in Colombia over 1988 to 2004. We find that a drop in coffee prices during the 1990s led to a disproportionate rise in conflict in the coffee areas. Poverty dynamics follow a similar pattern, while substitution into drug crops do not, which suggests that it is the fall in income rather than the drug trade that fuelled this effect. In contrast, we find that oil prices are positively related to clashes with government forces, and that state revenue is used to strengthen military presence in oil areas. Our results suggest that the income channel is critical in determining how price shocks to labor-intensive commodities affect insurgency. However, for capital-intensive goods, the revenue effect predominates in mediating how the value of the commodity affects violence. 2006 2020-09-11T21:05:39Z info:eu-repo/semantics/preprint info:eu-repo/semantics/draft https://repository.urosario.edu.co/handle/10336/29846 eng info:eu-repo/semantics/openAccess application/pdf Harvard University instname:Universidad del Rosario
institution EdocUR - Universidad del Rosario
collection DSpace
language Inglés (English)
topic Colombia
Civil War
Resource Curse
Difference-in-Differences
spellingShingle Colombia
Civil War
Resource Curse
Difference-in-Differences
Vargas, Juan F.
Dube, Oeindrila
Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia
description The “Resource Curse” posits a positive association between the value of natural commodities and civil conflict. In this paper, we suggest that the value-to-violence relationship differs across commodities, and that the factor intensity of production determines whether a rise in the price of a legally traded good will exacerbate conflict. We exploit exogenous price shocks for coffee and oil to test this hypothesis, using data on politically-motivated violence in Colombia over 1988 to 2004. We find that a drop in coffee prices during the 1990s led to a disproportionate rise in conflict in the coffee areas. Poverty dynamics follow a similar pattern, while substitution into drug crops do not, which suggests that it is the fall in income rather than the drug trade that fuelled this effect. In contrast, we find that oil prices are positively related to clashes with government forces, and that state revenue is used to strengthen military presence in oil areas. Our results suggest that the income channel is critical in determining how price shocks to labor-intensive commodities affect insurgency. However, for capital-intensive goods, the revenue effect predominates in mediating how the value of the commodity affects violence.
format Preimpresión (Preprint)
author Vargas, Juan F.
Dube, Oeindrila
author_facet Vargas, Juan F.
Dube, Oeindrila
author_sort Vargas, Juan F.
title Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia
title_short Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia
title_full Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia
title_fullStr Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia
title_full_unstemmed Are All Resources Cursed? Coffee, Oil and Armed Conflict in Colombia
title_sort are all resources cursed? coffee, oil and armed conflict in colombia
publisher Harvard University
publishDate 2006
url https://repository.urosario.edu.co/handle/10336/29846
_version_ 1740172744962605056
score 12,111491

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