Abstract
Civil conflict is the nation’s most important historical event, and it became more frequent in countries already emerged from previous conflicts. High economic growth, as well as other institutional procedures, is key to break this conflict trap. Thus, the current article explores the role decentralization may play to enhance economic growth in post-civil conflict countries. In order to avoid untrue peaceful cases, the article adopted a strict criterion of post-conflict periods, leading to a small dataset. Distinguishing between two forms of decentralization and using two equations with different techniques, the article finds a hampering effect of fiscal decentralization on economic growth in countries emerging from civil conflicts, while it finds insignificant mixed effects of political decentralization. These findings support the distinction made between the real de facto decentralization and the official de jure one. They validate the belief that although central authorities in many countries pretend to apply decentralization, they limit its effectiveness by some legal procedures creating “fake” decentralization.
Appendix
The full and the short samples of political decentralization.
Country | Last year of conflict | First year of peace | Post-Conflict GDP pc growth (%) | Post-Conflict GDP pc growth-average (full peace period) | Serial number of this war in the country | Conflict years | Pre-war year | Wartime combined | Peacetime | Peace period (years) | Sustainable political decentralization | Three consecutive years of peace |
---|---|---|---|---|---|---|---|---|---|---|---|---|
Angola | 1995 | 1996 | 8.03 | 3.98 | 1 | 21 | 1974 | 1975–1995 | 1996–1997 | 2 | ||
Angola | 2002 | 2003 | 1.58 | 6.09 | 2 | 5 | 1997 | 1998–2002 | 2003–2014 | 12 | 1 | 1 |
Argentina | 1977 | 1978 | −5.90 | 1.31 | 1 | 4 | 1973 | 1974–1977 | 1978–2014 | 37 | 1 | |
Azerbaijan | 1994 | 1995 | −12.81 | 0.30 | 1 | 3 | 1991 | 1992–1994 | 1995–1996 | 2 | ||
Azerbaijan | 1998 | 1999 | 6.46 | 10.05 | 2 | 2 | 1996 | 1997–1998 | 1999–2005 | 7 | 1 | |
Bangladesh | 1991 | 1992 | 3.09 | 3.67 | 1 | 17 | 1974 | 1975–1991 | 1992–2014 | 23 | 1 | 1 |
Bolivia | 1967 | 1968 | −13.93 | 0.80 | 1 | 1 | 1966 | 1967 | 1968–2014 | 47 | 1 | |
Bosnia | 1995 | 1996 | 92.36 | 10.63 | 1 | 4 | 1991 | 1992–1995 | 1996–2014 | 19 | 1 | 1 |
Burundi | 2006 | 2007 | 1.14 | 1.26 | 1 | 13 | 1993 | 1994–2006 | 2007 | 1 | ||
Burundi | 2008 | 2009 | −0.11 | 0.64 | 2 | 1 | 2007 | 2008 | 2009–2014 | 6 | 1 | |
Cambodia | 1975 | 1976 | 3.15 | 1 | 9 | 1966 | 1967–1975 | 1976–1977 | 2 | |||
Cambodia | 1998 | 1999 | 9.22 | 6.28 | 2 | 21 | 1977 | 1978–1998 | 1999–2014 | 16 | 1 | |
Cameroon | 1961 | 1962 | 0.84 | 0.87 | 1 | 2 | 1960 | 1961 | 1962–1983 | 22 | 1 | |
Chad | 1972 | 1973 | −10.55 | −1.59 | 1 | 7 | 1965 | 1966–1972 | 1973–1975 | 3 | 1 | |
Chad | 1984 | 1985 | 18.50 | 2.09 | 2 | 9 | 1975 | 1976–1984 | 1985–1986 | 2 | ||
Chad | 1987 | 1988 | 11.84 | 0.60 | 3 | 2 | 1985 | 1986–1987 | 1988 | 1 | ||
Chad | 1994 | 1995 | −2.07 | 1.76 | 4 | 6 | 1988 | 1989–1994 | 1995–1996 | 2 | ||
Chad | 2003 | 2004 | 28.72 | 7.06 | 5 | 7 | 1996 | 1997–2003 | 2004–2005 | 2 | ||
Chad | 2010 | 2011 | −3.19 | 2.04 | 6 | 6 | 2004 | 2005–2010 | 2011–2014 | 4 | 1 | |
Congo, Dem. Rep. | 1965 | 1966 | 3.83 | 0.03 | 1 | 2 | 1963 | 1964–1965 | 1966 | 1 | ||
Congo, Dem. Rep. | 1967 | 1968 | 1.38 | −1.33 | 2 | 1 | 1966 | 1967 | 1968–1976 | 9 | 1 | |
Congo, Dem. Rep. | 1978 | 1979 | −2.34 | −4.82 | 3 | 2 | 1976 | 1977–1978 | 1979–1995 | 17 | 1 | |
Congo, Dem. Rep. | 2001 | 2002 | −0.13 | 2.29 | 4 | 6 | 1995 | 1996–2001 | 2002–2005 | 4 | 1 | |
Congo, Dem. Rep. | 2008 | 2009 | −0.42 | 3.55 | 5 | 3 | 2005 | 2006–2008 | 2009–2014 | 6 | 1 | |
Congo, Rep. | 1999 | 2000 | 4.90 | 2.84 | 1 | 3 | 1996 | 1997–1999 | 2000–2001 | 2 | ||
Congo, Rep. | 2002 | 2003 | −1.45 | 1.85 | 2 | 1 | 2001 | 2002 | 2003–2014 | 12 | 1 | |
Croatia | 1995 | 1996 | 10.00 | 2.58 | 1 | 1 | 1994 | 1995 | 1996–2014 | 19 | 1 | 1 |
Cuba | 1960 | 1961 | 2.55 | 1 | 2 | 1956* | 1957–1958 | 1959–2014 | 55 | |||
El Salvador | 1991 | 1992 | 6.14 | 2.40 | 1 | 13 | 1978 | 1979–1991 | 1992–2014 | 23 | 1 | |
Ethiopia | 2013 | 2014 | 7.21 | 7.21 | 1 | 50 | 1963 | 1964–2013 | 2014 | 1 | ||
Georgia | 1993 | 1994 | −9.49 | 5.51 | 1 | 2 | 1991 | 1992–1993 | 1994–2014 | 21 | 1 | 1 |
Guatemala | 1995 | 1996 | 0.48 | 1.25 | 1 | 30 | 1965 | 1966–1995 | 1996–2014 | 19 | 1 | |
India | 1960 | 1961 | 1.68 | 1.66 | 1 | 4 | 1955* | 1956–1959 | 1960–1961 | 2 | ||
India | 1971 | 1972 | −2.82 | 3.47 | 2 | 10 | 1961 | 1962–1971 | 1972–1981 | 10 | 1 | |
India | 2010 | 2011 | 5.23 | 5.16 | 3 | 29 | 1981 | 1982–2010 | 2011–2014 | 4 | 1 | |
Indonesia | 1961 | 1962 | −0.75 | 3.37 | 1 | 4 | 1960 | 1961 | 1962–1974 | 13 | 1 | |
Indonesia | 1988 | 1989 | 7.11 | 3.48 | 2 | 13 | 1975 | 1976–1988 | 1989–1996 | 8 | 1 | |
Indonesia | 2005 | 2006 | 4.12 | 4.35 | 3 | 9 | 1996 | 1997–2005 | 2006–2014 | 9 | 1 | 1 |
Iran | 1968 | 1969 | 9.93 | −0.13 | 1 | 2 | 1966 | 1967–1968 | 1969–1978 | 10 | 1 | |
Iran | 1988 | 1989 | 2.88 | 6.83 | 2 | 9 | 1979 | 1980–1988 | 1989 | 1 | ||
Iran | 1990 | 1991 | 10.40 | 2.44 | 3 | 1 | 1989 | 1990 | 1991–1992 | 2 | ||
Iran | 1997 | 1998 | 0.82 | 1.63 | 4 | 2 | 1995 | 1996–1997 | 1998 | 1 | ||
Iran | 2001 | 2002 | 6.11 | 3.86 | 5 | 3 | 1998 | 1999–2001 | 2002–2004 | 3 | 1 | |
Iran | 2011 | 2012 | −7.76 | −3.59 | 6 | 7 | 2004 | 2005–2011 | 2012–2014 | 3 | 1 | |
Iraq | 1970 | 1971 | 1.90 | 4.57 | 1 | 9 | 1961 | 1962–1970 | 1971–1972 | 2 | ||
Iraq | 1996 | 1997 | 17.50 | 5.30 | 2 | 24 | 1972 | 1973–1996 | 1997–2002 | 6 | 1 | |
Israel | 1996 | 1997 | 1.31 | 1.74 | 1 | 47 | 1949 | 1950–1996 | 1997–1999 | 3 | 1 | 1 |
Israel | 2012 | 2013 | 1.34 | 1.08 | 2 | 13 | 1999 | 2000–2012 | 2013–2014 | 2 | ||
Laos | 1961 | 1962 | 1 | 3 | 1958* | 1959–1961 | 1962–1963 | 2 | ||||
Laos | 1973 | 1974 | 1.63 | 2 | 10 | 1963 | 1964–1973 | 1974–1988 | 15 | 1 | ||
Laos | 1990 | 1991 | 1.35 | 4.88 | 3 | 2 | 1988 | 1989–1990 | 1991–2014 | 14 | 1 | |
Lebanon | 1960 | 1961 | 1 | 1 | 1957* | 1958 | 1959–1974 | 16 | 1 | |||
Lebanon | 1976 | 1977 | 2 | 2 | 1974 | 1975–1976 | 1977–1981 | 5 | 1 | |||
Lebanon | 1986 | 1987 | −8.66 | 3 | 5 | 1981 | 1982–1986 | 1987–1988 | 2 | |||
Lebanon | 1990 | 1991 | 35.72 | 3.48 | 4 | 2 | 1988 | 1989–1990 | 1991–2014 | 14 | 1 | |
Liberia | 2003 | 2004 | 0.67 | 3.05 | 1 | 4 | 1998 | 1999–2002 | 2003–2014 | 12 | 1 | |
Mauritania | 1978 | 1979 | 1.83 | 0.63 | 1 | 3 | 1975 | 1976–1978 | 1979–2014 | 36 | 1 | |
Morocco | 1989 | 1990 | 0.88 | 2.51 | 1 | 15 | 1974 | 1975–1989 | 1990–2014 | 25 | 1 | |
Mozambique | 1992 | 1993 | 4.45 | 4.22 | 1 | 15 | 1977 | 1978–1992 | 1993–2014 | 22 | 1 | |
Myanmar | 2011 | 2012 | 7.35 | 1 | 63 | 1948* | 1949–2011 | 2012 | 1 | |||
Myanmar | 2013 | 2014 | 7.58 | 7.58 | 2 | 1 | 2012 | 2013 | 2014 | 1 | ||
Nepal | 2006 | 2007 | 2.34 | 3.40 | 1 | 11 | 1995 | 1996–2006 | 2007–2014 | 8 | 1 | |
Nicaragua | 1979 | 1980 | 1.63 | −3.15 | 1 | 3 | 1976 | 1977–1979 | 1980–1981 | 2 | ||
Nicaragua | 1990 | 1991 | −2.36 | 1.88 | 2 | 9 | 1981 | 1982–1990 | 1991–2014 | 14 | 1 | |
Nigeria | 1970 | 1971 | 11.61 | 1.29 | 1 | 4 | 1966 | 1967–1970 | 1971–2010 | 40 | 1 | |
Pakistan | 1971 | 1972 | −1.90 | 1.16 | 1 | 1 | 1970 | 1971 | 1972–1974 | 3 | 1 | |
Pakistan | 1977 | 1978 | 4.73 | 2.37 | 2 | 3 | 1974 | 1975–1977 | 1978–2003 | 26 | 1 | |
Pakistan | 2004 | 2005 | 5.50 | 1.95 | 3 | 1 | 2003 | 2004 | 2005 | 1 | ||
Peru | 1999 | 2000 | 1.29 | 4.03 | 1 | 18 | 1981 | 1982–1999 | 2000–2006 | 7 | 1 | |
Peru | 2010 | 2011 | 5.07 | 3.75 | 2 | 4 | 2006 | 2007–2010 | 2011–2014 | 4 | 1 | |
Rwanda | 1994 | 1995 | 37.13 | 8.93 | 1 | 5 | 1989 | 1990–1994 | 1995 | 1 | ||
Rwanda | 2002 | 2003 | −0.27 | 4.84 | 2 | 7 | 1995 | 1996–2002 | 2003–2008 | 6 | 1 | |
Rwanda | 2012 | 2013 | 2.22 | 3.35 | 3 | 4 | 2008 | 2009–2012 | 2013–2014 | 2 | ||
Senegal | 1998 | 1999 | 3.81 | 2.12 | 1 | 2 | 1996 | 1997–198 | 1999 | 1 | ||
Senegal | 2001 | 2002 | −1.97 | 0.94 | 2 | 2 | 1999 | 2000–2001 | 2002 | 1 | ||
Senegal | 2003 | 2004 | 3.04 | 1.04 | 3 | 1 | 2002 | 2003 | 2004–2010 | 7 | 1 | 1 |
Senegal | 2011 | 2012 | 0.28 | 0.43 | 4 | 1 | 2010 | 2011 | 2012–2014 | 3 | 1 | |
Serbia | 1991 | 1992 | 0.25 | 1 | 1 | 1990 | 1991 | 1992–1997 | 6 | 1 | ||
Serbia | 1999 | 2000 | 8.10 | 3.96 | 2 | 2 | 1997 | 1998–1999 | 2000–2014 | 15 | 1 | 1 |
Sierra Leone | 2001 | 2002 | 20.50 | 6.05 | 1 | 11 | 1990 | 1991–2001 | 2002–2014 | 13 | 1 | |
Somalia | 1996 | 1997 | 1 | 11 | 1985 | 1986–1996 | 1997–2000 | 4 | 1 | |||
Somalia | 2002 | 2003 | 2 | 2 | 2000 | 2001–2002 | 2003–2005 | 3 | 1 | |||
South Africa | 1988 | 1989 | 0.13 | 0.64 | 1 | 23 | 1965 | 1966–1988 | 1989–2014 | 26 | ||
Vietnam | 1964 | 1965 | 4.83 | 1 | 10 | 1954* | 1955-1964 | 1965–2014 | 50 | 1 | ||
Sri Lanka | 1971 | 1972 | −1.73 | 3.16 | 1 | 1 | 1970 | 1971 | 1972–1983 | 12 | 1 | |
Sri Lanka | 2001 | 2002 | 3.28 | 3.92 | 2 | 18 | 1983 | 1984–2001 | 2002 | 1 | ||
Sri lanka | 2003 | 2004 | 4.02 | 4.81 | 3 | 1 | 2002 | 2003 | 2004 | 1 | ||
Sri Lanka | 2009 | 2010 | 6.95 | 7.25 | 4 | 5 | 2004 | 2005–2009 | 2010–2014 | 5 | 1 | |
Sudan | 1972 | 1973 | −2.41 | 2.21 | 1 | 9 | 1963 | 1964–1972 | 1973–1982 | 10 | 1 | |
Syria | 1982 | 1983 | −2.11 | 1.10 | 1 | 4 | 1978 | 1979–1982 | 1983–2010 | 18 | 1 | |
Tajikistan | 1998 | 1999 | 2.31 | 5.71 | 1 | 7 | 1991 | 1992–1998 | 1999–2009 | 11 | 1 | |
Tajikistan | 2011 | 2012 | 5.10 | 4.81 | 2 | 2 | 2009 | 2010–2011 | 2012–2014 | 3 | 1 | |
Thailand | 1982 | 1983 | 3.65 | 4.20 | 1 | 9 | 1973 | 1974–1982 | 1983–2002 | 20 | 1 | |
Turkey | 2013 | 2014 | 1.62 | 1.62 | 1 | 20 | 1993 | 1994–2013 | 2014 | 1 | ||
Uganda | 1992 | 1993 | 4.90 | 3.97 | 1 | 14 | 1978 | 1979–1992 | 1993 | 1 | ||
Uganda | 2011 | 2012 | 1.05 | 0.72 | 2 | 18 | 1993 | 1994–2011 | 2012 | 1 | ||
Yemen | 1970 | 1971 | 1 | 9 | 1961 | 1962–1970 | 1971–1978 | 8 | 1 | |||
Yemen | 1982 | 1983 | 1.08 | 2 | 4 | 1978 | 1979–1982 | 1983–1993 | 11 | 1 | ||
Yemen | 1994 | 1995 | 1.29 | 0.28 | 3 | 1 | 1993 | 1994 | 1995–2008 | 14 | 1 | |
Zimbabwe | 1979 | 1980 | 10.37 | −0.40 | 1 | 7 | 1972 | 1973–1979 | 1980–2014 | 35 | 1 | 1 |
Timor-Leste | 1999 | 2000 | 16.66 | 4.68 | 2 | 3 | 1996 | 1997–1999 | 2000–2014 | 15 | 1 | 1 |
Eritrea | 1992 | 1993 | 13.81 | 1.53 | 1 | 29 | 1963 | 1964–1992 | 1993–2014 | 12 | 1 | 1 |
Descriptive Statistics of the stricter sample of political decentralization dataset (4 consecutive years of peace).
Political decentralization | Post-Conflict GDP pc growth (%)a | War period (years) | Post-Conflict GDP pc level (USD)c | Economic damage (%) | Peace period (years) | Ethnic fractionalizationb | Secondary school enrollmentb | Executive constraintsb | Voice and accountabilityb |
---|---|---|---|---|---|---|---|---|---|
61 Cases of post-conflict periods with at least one arrangement of political decentralization | |||||||||
Mean | 3.25 | 7.71 | 1233 | 13.38 | 15.39 | 0.53 | 44.71 | 3.79 | −0.68 |
SD | 2.73 | 7.59 | 1442 | 46.62 | 10.54 | 0.26 | 25.88 | 2.04 | 0.67 |
Min | −4.37 | 1 | 146.8 | −66.35 | 4 | 0.0023 | 5.61 | 1 | −1.98 |
Max | 11.46 | 30 | 7264 | 250.9 | 50 | 0.91 | 99.22 | 7 | 0.4 |
50 Cases of post-conflict periods | |||||||||
Mean | 3.07 | 7.8 | 1155 | 16.31 | 15.04 | 0.54 | 42.07 | 3.54 | −0.84 |
SD | 2.68 | 7.44 | 1272 | 48.7 | 11.09 | 0.27 | 24.71 | 2.1 | 0.67 |
Min | −4.366 | 1 | 146.8 | −66.35 | 4 | 0.0023 | 5.61 | 1 | −1.98 |
Max | 11.46 | 30 | 5189 | 250.9 | 50 | 0.91 | 99.22 | 7 | 0.395 |
11 Cases of post-conflict periods with no forms of political decentralization | |||||||||
Mean | 3.99 | 7.27 | 1530 | −3.36 | 17 | 0.53 | 57.56 | 4.9 | −0.26 |
SD | 2.93 | 8.59 | 2013 | 29.42 | 7.79 | 0.21 | 29.59 | 1.5 | 0.46 |
Min | −0.4045 | 1 | 212 | −65.28 | 7 | 0.045 | 18.41 | 3 | −1.26 |
Max | 10.63 | 29 | 7264 | 19.77 | 35 | 0.8 | 89.23 | 7 | 0.30 |
Sources: Author’s computations based on Table 6.
a means that the value mentioned is an average for the whole PC period; b means that the value mentioned is an average for the first two years in the PC period; c means that the value mentioned is for the first year in the PC period; d means that the value mentioned is an average for the last 3 years in the pre-conflict period; e means that the value mentioned is for the last year in the pre-conflict period. The GDP per capita is measured with constant 2005 USD. pc stands for per capita. Table 12 describes the variables.
Economic growth averages during the conflict circle between the two groups of countries.
Sustainable | Pre conflict | Pre conflict | Pre conflict | Pre peace | Pre peace | Pre peace | Pre peace | Pre peace | Peace | Peace | Peace | Peace | Peace | Peace |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
PD | −3 | −2 | −1 | −5 | −4 | −3 | −2 | −1 | 1 | 2 | 3 | 4 | 5 | 6 |
No | −1.5 | 2.9 | 3.4 | 2.01 | 1.99 | 1.01 | 1.12 | 2.65 | 3.07 | 3.67 | 3.32 | 3.02 | 2.44 | 2.94 |
With | 1.5 | 1.6 | 1 | 0.5 | 0.1 | −1.57 | −6.8 | 0.21 | 13.97 | 10.14 | 4.7 | 4.46 | 4.48 | 3.67 |
Source: Author’s computations based on Table 6.
Pre conflict indicates the peaceful period before the conflict erupts. Pre peace indicates conflict years before the peace comes. Peace indicates the peaceful post-conflict period. PD stands for political decentralization. Table 12 describes the variables.
Robustness check for political decentralization equation.
Variables | Model PD5 | Model PD6 | Model PD7 | Model PD8 |
---|---|---|---|---|
Log of initial GDP pc | −0.00755** | −0.0762 | −0.00631 | |
(0.00365) | (0.0768) | (0.00525) | ||
Log of capital formation | 0.0286 | 0.249 | 0.00843 | |
(0.0184) | (0.213) | (0.0171) | ||
Log of public consumption | −0.00852 | 0.0980 | −0.00187 | |
(0.00625) | (0.114) | (0.0121) | ||
Population growth | −0.00828*** | −0.0387 | −0.00881 | |
(0.00253) | (0.0343) | (0.00725) | ||
Executive constraints | −0.00142 | 0.0182 | −1.23e-05 | |
(0.00183) | (0.0229) | (0.00187) | ||
Secondary school enrollment | 0.000320** | −6.88e-05 | 0.000373 | |
(0.000137) | (0.000567) | (0.000223) | ||
Trade openness | 0.000170 | −0.00343 | 0.000397** | |
(0.000102) | (0.00337) | (0.000165) | ||
Political decentralization | 0.00849 | −0.00221 | −0.0498 | 0.00242 |
(0.00845) | (0.00430) | (0.0560) | (0.0135) | |
Economic damage | 6.49e-05 | −0.000600 | 0.000450** | |
(9.02e-05) | (0.000583) | (0.000212) | ||
Ethnic fractionalization | −0.0142 | 0.110 | −0.0412* | |
(0.0170) | (0.142) | (0.0236) | ||
Obs. | 57 | 32 | 12 | 20 |
R2 | 0.018 | 0.636 | 0.976 | 0.773 |
RMSE | 0.025 | 0.017 | 0.011 | 0.015 |
Source: Authors’ computations based on regressing Equation (1).
The regressions in Models PD5 and PD6 build on an annual unbalanced panel covering 61 cases of post-civil conflict periods in 47 countries and spanning between 1960 and 2014. The regression in Model PD7 builds on a sub-group that includes only the PCCs where the conflict incompatibility concerns controlling over territory, while the regression in Model PD8 builds on a sub-group that includes only the PCCs where the incompatibility concerns controlling over central power. Robust standard errors in parentheses. ***, **, *indicate significance at the 1, 5, and 10%, respectively. pc stands for per capita. Table 12 describes the variables.
Robustness check of fiscal decentralization equation.
Variables | Model FD6 | Model FD7 | Model FD8 | Model FD9 | Model FD10 |
---|---|---|---|---|---|
Log of capital formation | 0.0576** | 0.0608*** | 0.0310*** | 0.229*** | |
(0.0246) | (0.0147) | (0.00853) | (0.0207) | ||
Log of public consumption | −0.0458*** | −0.0261 | −0.0488*** | 0.0169 | |
(0.00879) | (0.0259) | (0.00925) | (0.0708) | ||
Population growth | −1.756*** | −2.779*** | −1.540*** | −4.178 | |
(0.401) | (0.853) | (0.345) | (3.376) | ||
D. Executive constraints | 0.00464 | 0.00406 | 0.0222 | 0.000862 | |
(0.00401) | (0.00723) | (0.0164) | (0.00433) | ||
D. Secondary school enrollment | 0.00142 | 0.000912 | 0.00336 | −0.000807 | |
(0.00242) | (0.00157) | (0.00402) | (0.00212) | ||
Trade openness | −0.000472 | −0.000703** | 5.73e-05 | −0.000773 | |
(0.000622) | (0.000343) | (0.000441) | (0.00108) | ||
Fiscal decentralization | −0.0150 | −0.0351** | −0.0485** | −0.0279** | −0.137** |
(0.0142) | (0.0162) | (0.0218) | (0.0108) | (0.0451) | |
Ethnic fractionalization | 0.0801 | ||||
(0.0810) | |||||
Economic damage | −3.16e-05 | ||||
(0.000531) | |||||
Observations | 162 | 116 | 101 | 80 | 36 |
R2 | 0.011 | 0.291 | 0.276 | 0.781 | |
Number of wars | 17 | 16 | 14 | 9 | 7 |
F-test for joint significant of fixed effects | 14.27*** | 36.41*** | 5678.62*** | 37.03*** | |
RMSE | 0.033 | 0.03 | 0.031 | 0.021 | |
Sigma_u | 0.035 | ||||
Sigma_ε | 0.029 | ||||
Rho | 0.59 | ||||
Wald χ2 | 1.867 |
Source: Authors’ computations based on regressing Equation (4).
The regressions in Models FD6, FD7, and FD8 build on an annual unbalanced panel covering 61 cases of post-civil conflict periods in 47 countries and spanning between 1960 and 2014. The regression in Model FD9 builds on a sub-group that includes only the PCCs where the conflict incompatibility concerns controlling over territory, while the regression in Model FD10 builds on a sub-group that includes only the PCCs where the incompatibility concerns controlling over central power. Robust standard errors in parentheses. ***, **, *indicate significance at the 1, 5, and 10%, respectively. We estimate Model FD8 using Hausman-Taylor estimator, with expenditure decentralization, economic damage, population growth, and executive constraints are treated as endogenous variables. D. means that we use the first differences for this variable. Description of the variables used is in Table 12.
Between and within components of the standard deviation of our data.
Variables | Mean | SD | |
---|---|---|---|
Log of economic growth pc | Overall | 0.025 | 0.055 |
Between | 0.026 | ||
Within | 0.049 | ||
Log of economic level pc | Overall | 6.9 | 0.99 |
Between | 1.033 | ||
Within | 0.206 | ||
Log of capital formation | Overall | 2.985 | 0.426 |
Between | 0.332 | ||
Within | 0.305 | ||
Log of public consumption | Overall | 2.540 | 0.537 |
Between | 0.469 | ||
Within | 0.264 | ||
Log of population growth | Overall | 0.0198 | 0.011 |
Between | 0.011 | ||
Within | 0.006 | ||
Executive constraints | Overall | 0.015 | 0.557 |
Between | 0.146 | ||
Within | 0.549 | ||
Trade openness | Overall | 66.285 | 32.779 |
Between | 29.689 | ||
Within | 17.307 | ||
Economic damage | Overall | 6.445 | 32.444 |
Between | 44.159 | ||
Within | 0 | ||
Secondary school enrollment | Overall | 1.293 | 2.270 |
Between | 1.234 | ||
Within | 2.126 | ||
Expenditure decentralization | Overall | 0.445 | 0.398 |
Between | 0.358 | ||
Within | 0.227 | ||
Ethnic fractionalization | Overall | 0.524 | 0.247 |
Between | 0.252 | ||
Within | 2.23E-16 |
Source: Authors’ computations.
SD stands for standard deviations. The analysis builds on an annual unbalanced panel covering 61 cases of post-civil conflict periods in 47 countries and spanning between 1960 and 2014. Overall stands for the overall deviation; Between stands for the deviation between countries; Within stands for the overtime deviation within countries. pc stands for per capita. Table 12 describes the variables.
Definitions and sources of the variables used.
Variables | Description | Unit | Source/Based on |
---|---|---|---|
Per capita GDP Growth in Political Decentralization Equation | The difference in the log of per capita GDP between the end of the conflict and the end of the PC period | % Annual | World Bank/WDI |
Per capita GDP Growth in Fiscal Decentralization Equation | The difference in the log of per capita GDP in two consecutive years | % Annual | World Bank/WDI |
Log of initial GDP pc | The logarithmic value of per capita GDP in the first peaceful year | constant 2005 USD | World Bank/WDI |
Political decentralization | A dummy variable taking a unitary value if the peace agreement involves at least one form of decentralization | 0/1 | Uppsala Conflict Data Program/Peace Agreement Dataset |
Sustainable political decentralization | A dummy variable taking a unitary value if the peace agreement involves at least one form of decentralization and the agreement sustains | 0/1 | Uppsala Conflict Data Program/Peace Agreement Dataset |
Log of capital formation | The logarithmic Value of the gross fixed capital formation as a percentage of GDP | % of GDP | World Bank/WDI |
Log of public consumption | The logarithmic Value of the governmental current expenditure as a percentage of GDP | % of GDP | World Bank/WDI |
Population growth in political decentralization equation | The difference in the log of the population between the end of the conflict and the end of the PC period | % Annual | World Bank/WDI |
Population growth in fiscal decentralization equation | The difference in the log of the population in two consecutive years | % Annual | World Bank/WDI |
Executive constraints | The extent of institutionalized constraints on the decision-making powers of chief executives, whether individuals or collectivises. Values are expressed in a 7-category scale, ranging from unlimited authority to executive parity or subordination | 1–7 | Polity IV dataset |
Secondary school enrollment | The ratio of total secondary enrollment, regardless of age, to the population of the age group that officially corresponds to that level of education | % | World Bank/WDI |
Trade openness | The ratio of exports and imports (in the local currency) to GDP (in the local currency) | % | World Bank/WDI |
Ethnic fractionalization | Ethnic fractionalization is measured by the ethnolinguistic fractionalization index. It measures the probability that two randomly drawn individuals from a given country do not belong to the same group. It ranges between 0 and 1. We use the religious fractionalization index when the ethnic index is absent | 0–1 | Alesina, Devleeschauwer, Easterly, Kurlat, and Wacziarg (2003) |
Economic damage | The simple GDP change between the beginning and the end of a conflict | % of the pre-conflict GDP | World Bank/WDI |
Expenditure decentralization index | It represents the average share of the local expenditures as a percentage of the overall expenditures in a specific country | % | World Bank/WDI |
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