4.3 Conflict
A more sinister expression of collective action is conflict. In the second half of the
twentieth century and well into the first decade of the twenty first, the loss of human life
from conflicts in developing countries is immense; the costs are beyond measurement.
Even the narrow economic costs of conflict can be extremely large (Hess (2003)).
That conflict contributes to economic regress is not surprising. But given our focus
on history-dependence, it is of equal interest to consider the casual chain running from
underdevelopment to conflict. That chain has a natural and simple foundation: poverty
reduces the opportunity cost of engaging in conflict. The grabbing of resources, often in
an organized way, is often a far more lucrative alternative to the steady process of wealth
accumulation. It’s certainly quicker. (One might argue that there is less to gain as well,
but this effect is attentuated in unequal societies.)
This unfortunate observation has substantial empirical support. For instance, Miguel,