Building Peace: The Impact of Aid on the Labor Market for Insurgents

Radha Iyengar, Jonathan Monten, Matthew Hanson

NBER Working Paper No. 17297
Issued in August 2011
NBER Program(s):   LS

Employment growth could reduce violence during civil conflicts. To determine if increased employment affects violence we analyzed varying employment in development programs run by different US military divisions in Iraqi districts. Employment levels vary with funding periods and the military division in charge. Controlling for variability between districts, we find that a 10% increase in labor-related spending generates a 15-20% decline in labor-intensive insurgent violence. Overall the 10% spending increase is associated with a nearly 10% violence reduction, due to reduction in attacks which kill civilians, but increased attacks against the military. These findings indicate that labor-intensive development programs can reduce violence during insurgencies.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Information about Free Papers

You should expect a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


An online appendix is available for this publication.

Acknowledgments and Disclosures

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w17297

Users who downloaded this paper also downloaded these:
Berman, Shapiro, and Felter w14606 Can Hearts and Minds Be Bought? The Economics of Counterinsurgency in Iraq
Iyengar and Monten w13839 Is There an "Emboldenment" Effect? Evidence from the Insurgency in Iraq
Berman, Callen, Felter, and Shapiro w15547 Do Working Men Rebel? Insurgency and Unemployment in Iraq and the Philippines
Benmelech, Berrebi, and Klor w16320 Economic Conditions and the Quality of Suicide Terrorism
Condra, Felter, Iyengar, and Shapiro w16152 The Effect of Civilian Casualties in Afghanistan and Iraq

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us