There are supplementary interesting discussions on the economic costs of violence, e.g. Skaperdas (forthcoming), while emphases on methods.
1.1. Purpose and research question
The purpose of this thesis is to analyze and present the economic downturn and the costs of conflict by emphasizing conflicts and wars within the Middle East and US invasion of Iraq to demonstrate costs over some other part of the region.
A side note and also a significant aim, however, is also to demonstrate how the nation would have developed on the average in absence of the conflict. Furthermore, an explanation of the significance of these kinds of studies as well its methodological complications is going to be provided. The study question of this thesis if specified as:WHAT ARE THE IMPACTS OF MENA REGION’S CONFLICTS ON THE ECONOMY OF THE REGION AND WORLD?
1.2. Disposition
Over the following section, definitions, a theoretical framework along with other explanations such as the significance of this type of study will be presented. The next section will present a literature review, of the current and existing literature on the economic costs of conflict, including a particular illustration of the complications behind measuring certain factors such as military expenditure. This will be followed by two different methods, which can be utilized when discussing the economic downturn and the costs associated with a conflict, included in this is a counterfactual and of the typology of costs where both direct and indirect costs are comprised. To be able to understand the case studies, a historical background overview over the region and selected countries will be provided well as the empirical data for Iraq's invasion of Kuwait 1990 and its particular spillovers in Iraq and therefore the US invasion of Iraq in 2003. It is, however, critical to observe that all costs and details certainly not provided as this paper will not be able to cover that, however, the primary findings and costs will be presented for those three cases. The lasts section will comprise of an analysis of the results, that have been presented in the earlier section followed by a conclusion, which briefly sums up the paper.
THEORY, METHODS, AND EXPLANATIONS
2.1 How to Define Armed Conflict?
According to a new study from Uppsala Conflict Data Program (UCDP), an armed conflict is described “a contested incompatibility that concerns government or territory or both, where the use of armed force between two parties leads to at a minimum 25 battle-related deaths within a year.” Moreover, UCDP categorizes conflicts conferring to potency and efficacy:
• Minor armed conflicts: A minimum of 25 battle-related deaths in a year but fewer than 1,000, and
• War: Not less than 1,000 battle-related deaths during a year.”
2.2. Theoretical framework – Conflict economics
Conflict and war are actually a challenging topic to understand from a traditional economic perspective. The challenge originates from the emphasis that the field places for the win-win aspects of exchange and also the gains from trade, at the cost of overlooking environments with poorly specified and poorly enforced property rights. The last environments are those that conflict normally arises from (Garfinkel, Skaperdas: 2006).
Furthermore, you could say that this field is a branch of economics, which puts the allocation of resources by means of violent fighting by for example putting conflict into various forms of economic models. Conflict economics presents the concept that agents must decide between productions of resources and production of weaponry. Conflict economics has two defining features. Firstly, it maintains which the conceptions, principles, and methods of economics might be productively applied to the study of conflict actions. Therefore, varied concepts which include war, arms races, alliances, and terrorism are examined and understood as outcomes of purposeful choices receptive to modifications in fundamental incentives. The other defining characteristic of conflict economics is which it treats appropriating as a central economic activity, joining production and exchange as a means of obtaining wealth (Anderson & Carter). Traditional economic theories suppose that economic behavior is peaceful, however, in real economies conflicts over commodities and capitals demonstrate the opposite. Therefore, various appropriative actions were modeled, including resource conflicts, piracy, and extortion. These theories and models demonstrate how conflict both shapes and is also shaped by the traditional economic activities of production and exchange (Anderson & Carter) where the term “appropriation” refers to a taking that rests on force or the threat of force. 中东危机及其对经济的影响(3):http://www.chuibin.com/yingyu/lunwen_204984.html