2016年-世界发展银行全球_Sharing_Oil_Rents_and_Political_Violence_36页_1mb

Summary: Sharing Oil Rents and Political Violence

Core Content

This paper explores the relationship between the distribution of oil rents and the likelihood of political violence in conflict-prone countries. It presents a theoretical model and empirical analysis to understand how different transfer schemes affect conflict dynamics and welfare outcomes.

Main Points

• Oil Rents and Conflict: Oil wealth can both reduce and increase the likelihood of political violence depending on the size and type of transfers. Large transfers tend to reduce conflict, while small transfers may trigger it.

• Transfer Schemes:

  • Fiscal Transfers: Transfers to subnational governments result in higher consumption and public good provision but are less effective in preventing conflict.
  • Direct Transfers: Unconditional cash transfers to citizens are more effective in reducing the likelihood of conflict.
  • Wasting Resources: Allocating oil revenues to non-productive projects (white elephants) may lead to a significant reduction in conflict, although it is costly in terms of foregone consumption.

• Trade-off Between Channels:

  • Rent Dissipation Channel: Transfers reduce the amount of resources available for conflict, thus lowering the incentive to fight.
  • Opportunity Cost Channel: Transfers increase the resources available to competing groups, making it easier to finance rebellion or conflict.
  • The net effect on conflict depends on which channel dominates.

• Equilibrium Outcomes:

  • The paper introduces a strategic interaction model between two groups (incumbent and opposition) over three periods.
  • The model shows that the likelihood of conflict is determined by the resilience of democratic institutions (denoted by μ).
  • Depending on the value of μ, different equilibrium outcomes (peace, civil conflict, repression, insurgency) emerge.

• Empirical Evidence:

  • Using data from 86 countries between 1990 and 2011, the paper finds a non-monotonic relationship between the probability of conflict and the level of transfers.
  • Small transfers increase the probability of conflict, while large transfers decrease it.
  • The hump-shaped relationship is more pronounced in oil-rich countries.

Key Findings

• Scale of Transfers: In oil-rich countries, small transfers decrease the likelihood of peace, while large transfers increase it.

• Composition of Transfers: Direct transfers are more effective in reducing conflict, while fiscal transfers allow for higher consumption and public good provision.

• Self-Enforcing Transfers: Some transfer schemes, particularly those that reinforce repression or peace, can be self-enforcing, meaning they are more likely to be implemented and sustained without external enforcement.

• Model Novelty:

  • The paper introduces a model that combines a contest for resource appropriation with an aggregative public good game.
  • It shows that the effect of transfers depends on their magnitude, not just their allocation.
  • The model accounts for the possibility of conflict not wiping out non-oil income, which is a key difference from previous literature.

Conclusion

The paper concludes that while transfers can improve ex ante welfare by reducing the likelihood of conflict, only certain transfer schemes are ex post optimal and self-enforcing. The most effective in preventing conflict are direct transfers, but fiscal transfers and even resource-wasting policies may have their place in specific contexts, depending on the institutional resilience and the magnitude of oil rents.

Structure of the Paper

• Section 1: Introduction and background on oil rents and political violence.
• Section 2: Stylized facts and empirical analysis showing the non-monotonic relationship between transfers and conflict.
• Section 3: Theoretical model of conflict and equilibrium outcomes.
• Section 4: Analysis of how different transfer schemes affect the likelihood of conflict.
• Section 5: Welfare analysis comparing ex ante and ex post outcomes.
• Section 6: Conclusion and policy implications.

Policy Implications

• Redistribution and Stability: Effective redistribution can prevent political violence, but the scale and composition of transfers matter.
• Institutional Resilience: The resilience of democratic institutions plays a crucial role in determining the likelihood of conflict.
• Self-Enforcing Mechanisms: Transfers that align with the equilibrium outcome (peace or repression) are more likely to be sustained without external enforcement.

References

• The paper is part of a broader World Bank effort to understand the impact of fiscal policies on political stability.
• It builds on existing literature, including works by Besley and Persson (2011), Azam (1995), and Beviá and Corchón (2010), while introducing new insights on the role of public good provision and the trade-off between rent dissipation and opportunity cost channels.