Economic cooperation despite of political conflict: Israeli traders’ perception of Israeli-Palestinian food trade

Geesche M. Merkle, Rico Ihle, Yael Kachel and Ulf Liebe
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Geesche M. Merkle: Georg-August University Göttingen
Yael Kachel: Israeli Ministry of Agriculture and Rural Development
Ulf Liebe: University of Cambridge

No 151, Courant Research Centre: Poverty, Equity and Growth - Discussion Papers from Courant Research Centre PEG

Abstract: The ongoing political conflict between Israel and the Palestinian territories results in an increasing physical separation and societal alienation of both conflicting parties. In some contexts such as trade ongoing cooperation exists. We provide a micro-level analysis of economic interactions between Israeli and Palestinian wholesale traders of fruits and vegetables. We use a unique dataset gathered by a quantitative survey among Israeli wholesale traders in order to obtain evidence on their perspectives on this economic exchange. Trading patterns show vivid economic exchange of mainly informal character. Logistic regressions suggest that education and the personal social network play vital roles for the existence of Israeli-Palestinian trading relationships. Israeli traders feel not affected by the conflict but wish for its quick settlement. A low level of transaction problems is reported. They are mainly caused by the political and security situation and by the payment behavior of the Palestinian trading partners. Daily contacts of economic agents lead to continuous economic cooperation despite of ongoing political conflict and improve the perception of the actors of the other party.

Keywords: food trade; Middle East; quantitative survey; political conflict (search for similar items in EconPapers)
JEL-codes: F14 Q17 Z13 (search for similar items in EconPapers)
Date: 2013-09-26
New Economics Papers: this item is included in nep-agr and nep-ara
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Persistent link: https://EconPapers.repec.org/RePEc:got:gotcrc:151

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