The Long-Run Labor-Market Consequences of Civil War: Evidence from the Shining Path in Peru

Jose Galdo

No 5028, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This study exploits district-level variation in the timing and intensity of civil war violence to investigate whether early-life exposure to civil wars affects labor-market outcomes later in life. In particular, we examine the impacts of armed conflict in Peru, a country that experienced the actions of a tenacious, brutally effective war machine, the Shining Path, between 1980 and 1995. This study finds that the most sensitive period to early-life exposure to civil war violence is the first 36 months of life. A one standard deviation increase in civil war exposure leads to a four percent fall in adult monthly earnings. Neither fetal, nor pre-school, periods significantly affect long-run earnings. Substantial heterogeneity in the earnings impacts emerge when considering variation in the types of civil war violence. Sexual violations disproportionally affected the wages of women, while torture and forced disappearances disproportionally affected the wages of men. Evidence on intervening pathways suggests that health rather than schooling is the most important channel in connecting early-life exposure to civil war and adult earnings.

Keywords: instrumental variable approach; earnings; Shining Path; civil war; measurement error (search for similar items in EconPapers)
JEL-codes: I12 J13 O12 O15 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2010-06
New Economics Papers: this item is included in nep-his
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Citations: View citations in EconPapers (15)

Published - published in: Economic Development and Cultural Change, 2013, 61 (4), 789-823

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Journal Article: The Long-Run Labor-Market Consequences of Civil War: Evidence from the Shining Path in Peru (2013)
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