Conflicts And Windfall Rents: Some Empirical Evidence
Author: Afeefa Haider

The study provides the impact of windfall on the civil conflict in developing economies empirically, by covering the time span of 31 years from 1985 to 2016. Panel data has been used for 8 developing countries of Asia (Bangladesh, India, Indonesia, Myanmar, Mongolia, Pakistan, Philippines and Sri Lanka). The model is estimated to clarify the conflict occurrence can be attainable from aid schedules, resource rent and set of control variables, which are identical to the control variables used in the literature. By using a dichotomous variable and panel data, the study considers a quantitative methodology of panel probit estimation technique. The panel probit results conclude that both windfall rents foreign aid and resource rent significantly affect the conflict onset. Where, resource rent is positively influencing the conflict. While, foreign aid is negatively effecting the dependent variable. In order to avoid upcoming conflict, foreign aid is regarded as an essential instrument for politicians and aid organization. The condensed conflict probability not only eliminate the economic and social issues caused by conflict but, it influences the economic development positively, also. The policy implication states that the donors who intended to support a country for development, should also take notice of those countries that restrict unnecessary rent-seeking behavior. When the foreign aid is given in a huge amount or when the donors select the countries where the productive sector has been taxed larger than the foreign aid is anticipated to be less productive. Supervisor:- Dr. Karim Khan

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Keywords : Conflict Intensity, Conflict Type, FOREIGN AID, Military Expenditure, Panel Probit, Resource Rent
Supervisor: Karim Khan

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