Commodity Price Shocks and the Seasonality of Conflict

David Ubilava, Kadir Atalay and Justin V Hastings

No 2021-03, Working Papers from University of Sydney, School of Economics

Abstract: Commodity price shocks can exacerbate conflict in low-income countries where agriculture usually is a key source of employment and income. A unique feature of agricultural income is its seasonality, which manifests in harvest-time windfalls. Conflict, therefore, can be seasonal as well. We combine temporal variation in international cereal prices at monthly frequency with spatial variation in cereal crop production and harvest seasons at the one-degree grid cell level to investigate the effect of year–on–year growth in cereal prices on violent attacks across Africa. We find that in the cropland, conflict is more likely during the first three months after a harvest, when the expected value of spoils to be appropriated is highest. A one–standard–deviation annual price growth in the first month after harvest can result in nearly thirteen–percent increase in conflict incidents in that period. Among potential perpetrators, political militias are the most likely culprits behind seasonal conflict in the cropland of Africa. We argue this is because of characteristics specific to political militias, which make them liable to pursue short-term violence in crop-producing regions. Overall, our results reveal rapacity as a plausible mechanism that links conflict with agricultural income. This study offers an important nuance to the growing literature aimed at investigating the economic causes of conflict in fragile states with weak institutions.

Keywords: Africa; Cereals; Conflict; Prices; Seasonality (search for similar items in EconPapers)
Date: 2021-03, Revised 2021-07
New Economics Papers: this item is included in nep-agr, nep-cwa and nep-dev
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