Oil Price Shocks and Conflict Escalation: Onshore versus Offshore

Jørgen Andersen, Frode Martin Nordvik and Andrea Tesei

Journal of Conflict Resolution, 2022, vol. 66, issue 2, 327-356

Abstract: We reconsider the relationship between oil and conflict, focusing on the location of oil resources. In a panel of 132 countries over the period 1962-2009, we show that oil windfalls escalate conflict in onshore-rich countries, while they de-escalate conflict in offshore-rich countries. We use a model to illustrate how these opposite effects can be explained by a fighting capacity mechanism, whereby the government can use offshore oil income to increase its fighting capacity, while onshore oil may be looted by oppositional groups to finance a rebellion. We provide empirical evidence supporting this interpretation: we find that oil price windfalls increase both the number and strength of active rebel groups in onshore-rich countries, while they strengthen the government in offshore-rich ones.

Keywords: natural resources; conflict (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (4)

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Working Paper: Oil price shocks and conflict escalation: onshore versus offshore (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:sae:jocore:v:66:y:2022:i:2:p:327-356

DOI: 10.1177/00220027211042664

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