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 Economic Drivers of Mass Atrocities: Implications for Policy and Prevention
Stanley Foundation
Dr. Raymond Gilpin
 
August 2015
 
The relationship between violent conflict and economic factors has engaged scholars, practitioners, and policymakers for decades. Some scholars have theorized that competition for land, labor, and capital has led to wars between countries, others have asserted that intrasocietal economic inequalities have fueled civil unrest, while still others doubt the existence of a causal link. Empirical research by Paul Collier and Anke Hoeffler popularized the notion of “greed vs. grievance” and sought to explain violence perpetrated by armed nonstate actors by analyzing their motivations relative to the presence of mineral resources. Their work revisited prior scholarship, notably by Jeffrey Sachs and Andrew Warner, on the purported relationship between violent conflict and natural resource endowment in fragile regions. In spite of criticisms of their methodology, the robustness of their empirical analysis, and policy relevance of their conclusions, the “greed vs. grievance” debate paved the way for more nuanced considerations of economic drivers relative to noneconomic factors. Subsequent research, summarized by Daniel Lederman and William Maloney, challenged some previous research and concluded that there is not enough evidence to draw or assess causal links between the presence of mineral resources and risks of violence. Among other things, they found that the positive empirical results are not only sensitive to the definition of economic factors applied in some models, they are also specific to the type of conflict considered. It is, therefore, very difficult to link economic factors to violent conflict conclusively.
 
This conundrum is made even more challenging when considering mass atrocities, which are characterized by genocide, ethnic cleansing, war crimes, and crimes against humanity.
 
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At their core, mass atrocities are a form of violence perpetrated against the “other” for a broad range of interconnected ethnic, ideological, religious, and political reasons. In many cases, these reasons have economic drivers that underlie, trigger, or sustain mass atrocities. These drivers have received relatively little attention, to the detriment of effective policies that could prevent or respond to mass atrocities. The complex dynamics involving economic factors and mass atrocities complicate not only the analysis of the problem but also the response to it. If economic factors are central to understanding and driving mass atrocities, they must feature more prominently in efforts at resolution. A failure to more fully incorporate economic considerations in conflict and atrocity prevention and response strategy could help explain high recidivism rates in some conflict regions.
 
This brief will consider four fundamental questions: To what extent does economic inequality precipitate mass atrocities? What role do natural resources play in explaining the incidence and severity of mass atrocities? Do models of economic governance contribute to understanding the onset and resolution of mass atrocities? How does an understanding of economic drivers help forestall, and effectively respond to, mass atrocities?
 
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Entrenched economic inequality is a key factor worthy of close consideration as a driver of mass atrocity risk. In most fragile states, weak institutions and endemic corruption have created governance frameworks that sustain ruling groups by collectively reinforcing networks that underpin the political economy of the country. The ruling groups/ regimes institutionalize economic inequality as a way to ensure group survival. In these neopatrimonial systems, the chasm between groups is defined by identity, which usually has regional, religious, or ethnic undertones. Over time, the gap between supporters and opponents deepens and widens because contested legitimacy forces regimes into a self-preservation mode, which is characterized by the use of government policy (e.g., resource allocation decisions and the politicization of foreign aid), the use of ill-gotten wealth to buy patronage, and a range of oppressive tactics. The overt control of economic assets and the sometimes covert denial of access to nonsupporters effectively politicize economic opportunity and intensify economic marginalization. For example, a stark socioeconomic disparity between the oil-rich southern states in Nigeria and their counterparts in the north partly explains the deep-seated discontent felt in the north. According to Nigeria’s 2013 Millennium Development Goals report, while poverty rates were generally below 50 percent in the south of the country, in the north they generally exceeded 70 percent. The difference in social indicators is equally stark. For example, infant mortality rates are 70 (per one-thousand live births) in the north-east and 28 in the south-west, and female literacy (between ages 15-24) is higher than 80 percent in the southwest but below 50 percent in the north. This has stoked discontent and helped facilitate recruitment and radicalization by extremist groups like Boko Haram.
 
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The natural resource/security nexus constitutes a combination of poor governance, weak institutions, and external factors that combine with the mismanagement and abuse of natural resources as drivers of violence and atrocity risk. While natural resources could be defined to include land, water, fisheries, forestry, and mineral wealth, this brief will adopt a narrow definition that focuses on minerals like diamonds, gold, ores, and petroleum products. Literature abounds on the relationship between mineral wealth and violent conflict/unrest. Some researchers have focused on a narrow macroeconomic dimension that examines the potentially negative impact of windfall gains from natural resource exports on the economy. This phenomenon was documented by the Economist magazine in its 1977 coverage of the impact of an oil boom in the Netherlands on the nonoil sector, via an artificial appreciation of the currency. The argument contended that the sudden rise in the value of the Dutch guilder (caused by a spike in global oil prices) made nonoil sector trade anemic and uncompetitive. Weak jobs growth and capital flight (caused by low domestic interests designed to slow currency appreciation) caused the economy to stall, leading to what was described as “external health and internal ailments,” dubbed the Dutch Disease. Decades later, this discussion evolved into a much broader concept of impact that involves macroeconomic destabilization, weak governance, moribund institutions, corruption, political instability, and socioeconomic malaise—the so-called resource curse. Coupled with this broader definition is a sense of determinism that equates the presence of mineral resources with deprivation and violence.
 
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Although empirical results relating to causality might be inconclusive, the relationship between the management or mismanagement of natural resources and violent conflict in many developing countries is undeniable. A combination of predatory forms of governance, disregard for the rule of law, deep and persistent socioeconomic inequality, endemic impunity, and weak judicial institutions create a climate within which violence easily translates into acts of mass atrocity. Thus, understanding the natural resource/security nexus could be a key to addressing and preventing mass atrocities in resource-driven states. Reversing the Curse: Maximizing the Potential of Resource-Driven Economies, published by the McKinsey Global Institute in 2013, analyzes the nexus by examining six discrete points along the natural resource value chain. It starts by reviewing the prerequisites for the development of natural resources (i.e., regulatory institutions and investments in infrastructure), then examines arrangements in place to capture value (i.e., fiscal regimes and local content development), and lastly considers systems to transform value into longer term economic development (i.e., resource management strategies and socioeconomic investments). These three points will hereafter be referred to as the development, capture, and transformational phases of natural resource policy development and implementation. The use of the word phase is not intended to indicate the timing or order in which these phases should be executed but rather to reference the cluster of policy and governance elements described by each.
 
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Contemporary resource-driven states are much better positioned for growth and development than they were before the turn of the millennium. Macroeconomic performance has been quite commendable; over three-quarters of the world’s fastest growing economies since 2000 are resource driven. The growth of foreign direct investment has outpaced development assistance in these economies. On the governance front, there have been fewer coups and more elections in these states, heralding a gradual shift toward increasing democratization. Furthermore, most of the seemingly intractable wars of the 1980s and 1990s have ended.
 
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Although we do not know a lot about causal links between natural resources and violent conflict, we do know that the most unstable and violence-prone countries are usually resource driven. It is also apparent that the political economy that evolves in such states facilitates corruption, impunity, and zero-sum politics, which pave the way for sustained violence and mass atrocities. Violence in resourcedriven states is difficult to contain because revenues from natural resources exacerbate and perpetuate violence that fuels a war economy that sustains the conflict and provides incentives to the belligerents to prolong the war. Prevention is important because it costs much less in blood and treasure.
 
Through prevention, countries could avoid the potentially negative consequences experienced by many resource-driven states by investing in all citizens, ensuring that adequate services are delivered equitably, and adopting strategies that build resilience and promote security for all.
 
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Prevention must also be stressed in conflict-affected countries, since violent conflict is much more likely to reignite in resource-driven countries. Prevention in these cases would involve including economic actors in the design and implementation of peace deals, understanding the political economy when considering postconflict incentives and sanctions, using economic tools to accomplish quick gains, taking immediate steps to dismantle the war economy, and prioritizing the effective coordination of economic interventions by bilateral and multilateral stakeholders.”
 
Read the full report here.
 
 
 

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