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Carrot or stick? Redistributive transfers versus policing in contexts of civil unrest

Patricia Justino ()

No 3, Research Working Papers from MICROCON - A Micro Level Analysis of Violent Conflict

Abstract: Recurrent episodes of civil unrest significantly reduce the potential for economic growth and poverty reduction. Yet the economics literature offers little understanding of what triggers civil unrest in society and how to prevent it. This paper provides a theoretical analysis in a dynamic setting of the merits of redistributive transfers in preventing the onset of (and reducing) civil unrest and compare it with policies of more direct intervention such as the use of police. We present empirical evidence for a panel of Indian states, where conflict, transfers and policing are treated as endogenous variables. Our empirical results show, in the mediumterm, redistributive transfers are both a more successful and cost-effective means to reduce civil unrest. Policing is at best a short-term strategy. In the longer term, it may trigger further social discontent.

Keywords: Transfers; policing; conflict; unrest; India; panel data (search for similar items in EconPapers)
JEL-codes: C23 C33 D74 I38 O53 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2007
New Economics Papers: this item is included in nep-cwa
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http://www.microconflict.eu/publications/RWP3_PJ.pdf First version, 2007 (application/pdf)
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