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The Impact of Peace: Evidence from Nigeria

Author

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  • Tillman Hönig

    (London School of Economics & Political Science)

Abstract
This paper studies the consequences of peace – or conversely, conflict – on four outcomes of fundamental economic relevance: Education, health, self-employment income and household expenditures. While the empirical literature on the consequences of conflict involving cross-country regression studies may deliver suggestive big-picture evidence on links between conflict and eco- nomic outcomes, establishing causation remains problematic. By contrast, my study builds on the rather recent micro-empirical literature and exploits a natural experiment in Nigeria to evaluate the consequences of a reduction of conflict. The amnesty policy implemented by the Nigerian government in the Niger Delta Region in 2009 is used as a policy shock to assess the effect of a conflict reduction on the outcomes of interest. My first finding is that this policy indeed established a period of peace. To evaluate the benefits of this peace, I then construct a synthetic control region from the states that are not part of the Niger Delta region and therefore unaffected by the policy as a within-country counterfactual to the Niger Delta region. I find that peace through the amnesty policy generated an increase in education by 0.5 years of schooling, a 67% increase in self-employment income and a 19% increase in household expenditures four years later. I do not find an effect on health.

Suggested Citation

  • Tillman Hönig, 2019. "The Impact of Peace: Evidence from Nigeria," HiCN Working Papers 293, Households in Conflict Network.
    • Handle: RePEc:hic:wpaper:293
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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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