Redistribution of Economic Resources due to Conflict: The Maoist Uprising in Nepal |
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| Affiliation: | 1. School of Economics, University of Kent, Kennedy Building, Park Wood Road, Canterbury, Kent CT2 7FS, United Kingdom;2. D 108 Center for Public Policy, Indian Institute of Management Bangalore, Bannerghatta Main Road, Bangalore, Karnataka 560076, India;1. European Bank for Reconstruction and Development London, United Kingdom;2. Centre for Economic Policy Research (CEPR), London EC1V 0DX, United Kingdom;1. Ph.D. Fellow of the Research Foundation - Flanders (FWO);2. Research Centre for Regional Economics (VIVES), KU Leuven - University of Leuven, Belgium;1. University of Siegen, 57068 Siegen, Germany;2. CESifo, Germany;3. Technical University of Darmstadt, 64283 Darmstadt, Germany;1. Institute of Advanced Research, Key Laboratory of Mathematical Economics of Ministry of Education, Shanghai University of Finance and Economics, 111 Wuchuan Road, Shanghai, 200433, China;2. Institute for Economic and Social Research, Jinan University, No. 601, West Huangpu Avenue, Guangzhou 510632, China;1. School of Business, University at Albany, State University of New York, Albany, NY 12222, United States of America;2. Department of Economics and Finance, UNCW Cameron School of Business, University of North Carolina Wilmington, Wilmington, NC 28403, United States of America;1. World Bank, 1818 H Street, NW Washington, DC 20433 USA;2. Faculty of Economics and Business, University of Groningen, Nettelbosje 2, Groningen 9747, AE, the Netherlands |
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| Abstract: | Nepal has seen a significant reduction in poverty over the period 1995–2010 which encompasses the decade-long Maoist-led civil war. So was the post-conflict provision of economic resources to districts related to their involvement in promoting the Maoist cause? We tackle this question combining theory and empirics. Our model predicts that poorer districts are more likely to support the Maoists and in return they get promised economic gains conditional on the Maoists prevailing post-conflict. Combining data on conflict with consumption expenditure data from the Nepal Living Standards Survey and data on foreign aid, we test these predictions. Our panel data estimates and our cross-sectional analysis consistently find strong support for our hypotheses. These are confirmed by the IV analysis that we perform at the panel level. |
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