Rebellion,Repression and Welfare

I develop a dynamic model of social conflict whereby manifest grievances of the poor generate the incentive of taking over political power violently. Rebellion can be an equilibrium outcome depending on the level of preexisting inequality between the poor and the ruling elite, the relative military capabilities of the two groups and the destructiveness of conflict. Once a technology of repression is introduced, widespread fear reduces the parameter space for which rebellion is an equilibrium outcome. However, I show that repression-driven peace comes at a cost as it produces a welfare loss to society.     

French Arms Exports and Intrastate Conflicts: An Empirical Investigation

The aim of this article is to evaluate how French Major Conventional Weapons (MCW) exports impact on the conflict intensity of recipient countries. The recent increase in French arms exports seems to contradict the French political discourse on the promotion of regional stability. We run zero-inflated ordered probit model in order to analyze the role of the arms trade on the intensity of civil conflicts in 144 countries from 1992 to 2014, using SIPRI and UCDP/PRIO data. Our results suggest that French MCW exports tended not to exacerbate intrastate conflicts during this period. This finding is robust to changes in the empirical framework. We propose two lines of explanations: France seems to be prone to choosing partners that respect human rights and selling more ‘defense-oriented’ MCW than the rest of the world.     

The Gravity of Arms

The aim of this paper is to investigate the determinants of international arms transfers in a gravity model framework. By distinguishing between the decision to export arms (extensive margin) and the value of the arms exported (intensive margin), while also considering its interdependence, is what differentiates this paper from previous research. A theoretically justified gravity model of trade augmented with political and security motives is estimated using a two-stage panel data approach for 104 exporting countries over the period from 1950 to 2007. In addition to the usual gravity variables related to the economic mass of the trading countries and the trade cost factors, the model is extended with political and security factors. The level of democracy in both trading partners, political differences between trading partners and voting similarity with the United States in the UN General Assembly of the countries engaged in trade are the main political factors, whereas the existence of conflicts, military pacts, and embargoes are taken as security motives. The key result indicates that both political and security motives are an important determinant of an arms trade, but their effects on the extensive margin of exports (the decision to order a transfer) differs from their effect on the intensive margin (average value of exports). Moreover, the relative importance of the factors under study has changed since 1989. In the post-cold war period, countries that are less democratic are more likely to export arms, military pacts are less relevant and embargoes play a role.     

Evasion costs and the theory Of conscription

This paper examines the trade and military relationship between two countries which have a common military enemy. The paper explains how the former two countries, which are military allies and trading partners, share the burden of defence against the third country. It demonstrates how the defence production of a country may hurt its ally because the latter country's terms of trade can be deteriorated. Whether or not a smaller ally spends less on defence is analyzed. Also analyzed is the effects of the reactions of the enemy country on the trade between the two allies and their welfare.     

Brothers in arms,yet again? Twenty-first century Sino-Russian strategic collaboration in the realm of defence and security

2014–2015 were years of turmoil for strategic relations, with Sino-Russian relations emerging as a particularly interesting set of ties to observe. This article asks whether recurrent Sino-Russian exhortations of friendship are mirrored by their strategic alignment in the defence and security realm, half a century after the end of the Sino-Soviet pact during the communist era. We examine the arms trade between the two countries and with regional partners, but also the recent pattern of bilateral and multilateral military exercises, as a combined test of the security and defence relationship. We are able to show that the image of friendship that both Moscow and Beijing like to promote, while apparent at the UN Security Council and within the BRICS group, remains constrained by rivalry in high-tech segments of the arms industry and by lingering concerns about the prospects of peer interference in their shared regional vicinity.     

TIME-VARYING CHARACTERISTICS OF SOUTH KOREA-UNITED STATES AND JAPAN-UNITED STATES MILITARY ALLIANCES UNDER CHINESE THREAT: A PUBLIC GOOD APPROACH

This paper investigates the nature of two military alliances under Chinese threat. The findings are as follows: First, South Korea does not consider China a significant threat while Japan and the United States have recognized China as a serious threat since the 1990s and the 2000s, respectively. Second, the relationship between South Korea and the United States is a true military alliance for all time periods, but the nature of the alliance has changed since the 1970s. Third, although Japan began to form an alliance relationship with the United States in the 1990s, Japan is considered a more significant ally by the United States. This paper implies that, should China provoke a military confrontation, it might be difficult to deduce a common solution among the three countries because of the different response to military threats from China.     

Ethnicity,class, and civil war: the role of hierarchy,segmentation, and cross-cutting cleavages

Why are some countries prone to ethno-nationalist conflict, whereas others are plagued by class conflict? This is a question that has seldom been raised and rarely been examined empirically. This paper presents a social-structural theory to account for the variable incidence of these two forms of political instability. These two types of conflict result from distinct principles of group solidarity – ethnicity and class – and since each individual is simultaneously a member of an ethnic group (or many such groups) and a particular class, these two principles vary in the degree to which they are mutually exclusive or cross-cutting. The degree of economic stratification between groups and economic segmentation within them shapes the relative salience of each principle of group solidarity in any society and is associated with a characteristic form of political mobilization. In places where between-group inequalities are high, and within-group inequalities low, ethnicity should be the dominant principle of group solidarity and serve as the primary basis of group conflict. By contrast, in countries where between-group inequalities are low, and within-group inequalities high, class is more likely to serve as the dominant principle of group solidarity, and conflicts along class lines are more likely. We test these conjectures with data in over 100 countries on cross-cutting cleavages, ethnic war, and class conflict. The results are supportive of the theory, and provide evidence that how groups are stratified and segmented in societies shapes the type of civil war.     

THE HUMAN CAPITAL PEACE: DEVELOPMENT AND INTERNATIONAL CONFLICT

This paper explores the relationship between human capital and international conflict. In theory, human capital may increase the opportunity cost of military service and the economic cost of injury and loss of life in combat; it may decrease the benefits of conflict as human capital cannot be easily appropriated or transferred; it may affect societal norms toward peace and war; and it may alter military productivity through new technology and complementarities between military technology and personnel. Using a panel of politically relevant dyads, I find robust empirical evidence that human capital may significantly decrease the likelihood of militarized conflict between nations. In short, the findings suggest that promoting human capital‐oriented development may help to increase peace in the world.     

Nuclear weapons and alliance institutions in the era of President Trump

The swearing in of Donald Trump as the 45th President of the United States presages, at the very least, a period of flux in American strategy with respect to the relationship between nuclear weapons and alliances. In this response to three thoughtful rejoinders to our article, “Nuclear weapons, the United States and alliances in Europe and Asia: Toward an institutional perspective,” we clarify key aspects of our argument and discuss why alliance institutions are likely to be relatively robust in the face of change, how they can influence national decision-making, and argue that they may exert a moderating influence over the new administration.     

A case study of redundant defence workers

In this article, the influence of conflict on the economies of neighbouring countries is discussed. The results from previous papers show a strong negative effect for an entire area around a country suffering from conflict, but this paper reaches a different conclusion, by using more recent data and adjusting the methodology previously employed. Additionally, a new type of contiguity matrix is constructed and used in the actual analysis. The final analysis consists of a large number of regressions and concludes that conflict actually has two opposing effects. First, like conflict countries themselves, directly contiguous countries actually suffer from the negative effects of proximate conflict. Secondly, however, there is also a positive spillover of conflict, which affects non‐contiguous countries and this effect is larger for countries that are closer to the conflict country. The results from the paper predominantly hold for the most violent kind of conflict.     

Military Expenditure,Economic Growth and Heterogeneity

This paper examines the impact of military expenditure on economic growth on a large balanced panel, using an exogenous growth model and dynamic panel data methods for 106 countries over the period 1988–2010. A major focus of the paper is to consider the possibility group heterogeneity and non-linearity. Having estimated the model for all of the countries in the panel and finding that military burden has a negative effect on growth in the short and long run, the panel is broken down into various groupings based upon a range of potentially relevant factors, and the robustness of the results is evaluated. The factors considered are different levels of income, conflict experience, natural resources abundance, openness and aid. The estimates for the different groups are remarkably consistent with those for the whole panel, providing strong support for the argument that military spending has adverse effects on growth. There are, however, some intriguing results that suggest that for certain types of countries military spending has no significant effect on growth.     

Comparing the Anglo-American and Israeli-American Special Relationships in the Obama Era: An Alliance Persistence Perspective

The Anglo-American and Israeli-American special relationships have proved to be unusually close and have confounded expectations that they would wither away with the changing international environment. In order to explain this, the article proposes a theory of ‘alliance persistence’ that is based on reciprocity over shared geostrategic interests, sentimental attachments and institutionalised security relations. The article employs this theoretical framework to explore how Anglo-American and Israeli-American relations have developed during the Obama administration. It argues that the Anglo-American relationship has been closer because of the two countries’ shared strategic interests, whilst the Israeli-American relationship has experienced divergences in how the security interests of the two sides have been pursued. The article concludes by assessing how the two relationships will fair in the post-Obama era and argues that there are numerous areas of tension in the US-Israeli relationship that risk future tensions.     

装备采购多目标激励模型研究

在将质量货币化从而实现激励目标测度统一的基础上,根据委托代理理论建立了委托人风险中性,代理人风险规避时的多目标激励数学模型,给出了激励系数的表达式,对激励系数与随机变量相关系数之间的关系进行了讨论。     

Resource Dependence and Armed Violence: Impact on Sustainability in Developing Countries

The dependence on oil, gas, and mineral exports arguably has a negative impact on economic growth in resource-rich, developing countries. This article looks at the impact of resource dependence on adjusted net savings (ANS) as an indicator of weak sustainability. Our results, based on a panel of 104 developing countries during the recent commodity price boom, confirm a negative relationship between resource extraction and sustainable development as measured by ANS. We further look at the specific role of armed conflict and armed violence as captured by the homicide rate. Armed conflict, which is positively associated with resource dependence, negatively affects ANS per capita according to both our OLS and instrumental variables (IV) estimates. Similarly, armed violence has a detrimental effect on sustainable development. Our IV estimate suggests that a one-point increase in the homicide rate decreases ANS per capita by $60. Since education expenditures are a critical ANS component, we further examine the impact of resource dependence and violence on human capital. Consistent with previous findings, resource-dependent countries underinvest in education but armed conflict and violence do not affect the instantaneous share of education expenditures, hinting at a detrimental effect working through physical and social capital rather than education.     

On the manipulation of transfer prices in a static environment

In a static environment, J. Hirschleifer's marginal cost solution to the transfer pricing problem is commonly accepted as analytically correct. However, actual pricing practice within Western corporations and socialist-planned economies generally deviates from marginal cost pricing. Some form of average cost pricing is more commonly chosen. Recently in this journal, H. Enzer has claimed to show that some form of average cost pricing is indeed the analytically correct solution to the transfer pricing problem when choice of technique and manipulation are allowed. Enzer claims that optimal decisions made by each of two divisions according to their individual self-interests are made compatible with overall firm optimization when the transfer price assigned to the internally-transferred commodity is any form of average cost. We show that the marginal cost solution is correct for Enzer's problem in the absence of manipulation by either division. Indeed, this was all that Hirschleifer claimed. In the process, we uncover a fundamental mathematical error in Enzer's argument. When manipulation of the transfer price by divisions is allowed, we demonstrate the faults with Enzer's average cost solution and conclude Hirschleifer's original statements on manipulation to be correct even in Enzer's environment. A final section briefly indicates the importance to the transfer pricing problem of a growing body of economic literature on incentive structures.     

A study of peacekeeping,peace-enforcement and private military companies in Sierra Leone

The four military interventions into the conflict in Sierra Leone between 1995 and 2000 met with varying degrees of success. One of the more effective ones was launched by a private military company (PMC) early in the conflict. In the following paper a comparison is made between different aspects of the PMC intervention and the interventions by national military and by multilateral forces from regional and international organisations. The findings are that the interventions of the PMC and national forces were more successful due to their clear peace-enforcing mandate, unitary structure, elite counterinsurgency training, intelligence-gathering capabilities, relationship with the public, incentive to win as efficiently as possible and role as a force multiplier for local forces. The failure of multilateral peacekeeping forces in peace-enforcing roles suggests that small contingents of elite special forces, whether donated unilaterally by governments or hired in a competitive PMC market, are not only likely to be more effective in bringing violent conflict to a halt, but could at the same time be helpful in building the capacity, loyalty and professionalism of local militaries.     

Country survey X: Defence spending in Turkey

This paper provides a country survey of the Turkish defence economy. Turkey is a member of NATO alliance and is strategically located between Europe and Middle East. Moreover, Turkey has a high defence burden and high economic growth. The first part of the survey presents a brief economic background of Turkey, its armed forces, the defence industry, its modernisation and trends in Turkish defence expenditure. The rest of the paper focuses on the relationships between defence spending and economic growth. The effect of defence spending on economic growth is econometrically estimated using a supply side model. Both externality effects and the size effect of defence spending are estimated for Turkey. The study concludes that defence expenditure stimulates economic growth while externalities from the defence sector to the rest of economy are negative for Turkey.     

Externalities in Military Spending and Growth: The Role of Natural Resources as a Channel through Conflict

This investigation re-examines the potential sources of positive externalities for the relationship between military spending and economic growth using recent advances in panel estimation methods and a large data-set on military expenditure. The investigation provides a new analysis on the relationship between conflict, corruption, natural resources and military expenditure and their direct and indirect effects on economic growth. The analysis finds that the impact of military expenditure on growth is generally negative as in the literature, but that it is not significantly detrimental for countries facing higher internal threats and for countries with large natural resource wealth once corruption levels are accounted for.