Oiling up the field. Forced internal displacement and the expansion of palm oil in Colombia

Jaime Millán-Quijano

No 01/2020, NCID Working Papers from Navarra Center for International Development, University of Navarra

Abstract: The analysis of the relationship between natural resources and violent conflicts has shown how positive shocks in agricultural commodities are usually linked with reductions in violence (opportunity cost effect), while positive shocks to minerals or extractive commodities seem to increase conflict (rapacity effect). In this paper we examine the case of palm oil expansion in Colombia and find that our results differ from previous studies. We use changes in international prices of palm oil to show how positive income shocks increased forced displacement in palm producing municipalities. We found that a 1% increase in the price of palm oil raises the forced internal displacement rate in palm municipalities by 0.42 standard deviations. We also show evidence that the negative effect of palm oil income shock was stronger in areas with paramilitary armies, weak contract institutions and better land distribution. In addition, increases in palm prices increase rural violence but not urban violence. Our results support the hypothesis that the violence linked with the palm expansion was the result of the search for new lands for palm trees in a framework of weak institutions. Therefore, one can argue that in the case of the palm expansion the rapacity effect over new lands was stronger than possible labor market effects.

Keywords: Income shocks; Conflict; Commodity prices; Natural resources; Forced displacement. (search for similar items in EconPapers)
JEL-codes: D74 F14 O13 O15 Q17 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2020-01
New Economics Papers: this item is included in nep-agr, nep-dev and nep-env
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Journal Article: Oiling up the field. Forced internal displacement and the expansion of palm oil in Colombia (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:nva:unnvaa:wp01-2020

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