The economics of war

April 29th, 2010

Civil war. It’s a funny term, if you think about it. Almost an oxymoron of sorts. But those who have been through a civil war know it’s anything but a laughing matter. The violence caused by intrastate conflict – or conflict that takes place within a state between politically oriented groups – can pit brother against brother and almost always results in plenty of civilian casualties.

However, if the factors that lead to intrastate conflict could be identified, then perhaps future conflicts could be prevented and current conflicts could be brought to a peaceful end. Religious and ethnic factors are often cited as causes, as they are involved in many of the world’s most intense intrastate conflicts. But while these factors no doubt play a role in intrastate conflict, they function more like facilitators of conflict rather than causes of it.

Instead, the real cause of intrastate conflict is related to the failure of a state’s power structure. The power structure of a state determines how and to whom political power is distributed. For example, in a dictatorship, power is centralized in the hands of a dictator. In a democracy, power is given to elected officials and usually divided among the executive, legislative and judicial branches.

To understand how failures in a state’s power structure can lead to conflict, the concept of power must be viewed as an economic good that’s governed by the laws of supply and demand. As long as the power structure can keep the balance of the supply and demand of power at equilibrium, peace can be maintained. But with only a limited supply of power available, if demand for power exceeds supply, then empirical observations suggest the probability of intrastate conflict substantially increases.

At times, the power structure of a state is divided along religious or ethnic lines. In Sudan, for example, a disproportionate amount of power resides with the predominately Muslim north. This unequal balance in the power structure led the predominately Christian south to rebel against the government in 1983, resulting in a civil war that lasted until 2005 – although violence and killings still continue today.

However, even power structures that are not divided along religious or ethnic lines are prone to intrastate violence. For example, in Somalia – home to perhaps the most violent conflict in the world – practically everyone is ethnically Somali and religiously Sunni Islam – but the power structure of the country is clan based, and clan rivalries are what plunged the state into civil war in 1991.

The reason, therefore, that many assume that intrastate conflict is caused by religious or ethnic differences is because the power structures of many states are divided along religious or ethnic lines. But the real cause of conflict is the failure of these power structures to maintain an equilibrium between the demand and supply of power, which then results in disproportionate balances of power. This leads groups that are marginalized to rebel against the government, resulting in civil war or, at the very least, intrastate conflict.