Community Research and Development Information Service - CORDIS


CIDAM — Result In Brief

Project ID: 208661
Funded under: FP7-IDEAS-ERC
Country: Italy

The role of civil conflicts in poverty

The past 30 years have seen many civil conflicts in developing countries. It is therefore crucial to understand the roots and the consequences of these conflicts, in order to fight poverty.
The role of civil conflicts in poverty
Using an economic approach, the EU-funded project CIDAM (Conflict, identity and markets) investigated conflicts in poor countries by examining the interaction of cultural, political and economic determinants.

The role of both domestic and international factors was assessed, including variables like income heterogeneity, economic shocks and resource endowments. The team created a new multidimensional indicator, taking into account that the salience of ethnic identity may depend on the degree of overlapping with categories based on income and education, and so on.

Researchers collected original data from the United States and proposed a test for racial discrimination in the justice system, based on reversal patterns in appeal decisions by higher courts.

An important part of the project was the empirical analysis of economic and geographic determinants of conflicts at the local level. CIDAM constructed a gridded level data set for sub-Saharan Africa, combining high-resolution information of conflict events, crop cultivation, weather shocks and mineral endowments.

Researchers also analysed the role of international players in civil conflicts by using a methodology based on the financial markets' reactions to news. This methodology gave the opportunity to address a few policy questions concerning the gains or losses of companies from violent conflicts or ways to detect violations of international embargoes.

Results show positive event returns from companies having their headquarters in countries with high corruption and low transparency in arms trade. This indicates that companies are more likely to violate arms embargoes. A method to detect potential embargo violations was suggested, based on chains of reactions by individual stocks.

Overall, the project has attempted to use economic, social and political factors to explain the occurrence of social or violent conflicts in developing countries. In addition to scholarly publications and the creation of new data sets, the project proposed new methodological tools and offered insights for the design of economic policies to prevent conflicts and fight poverty.

Related information


Civil conflicts, poverty, developing countries, CIDAM, embargoes
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