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Globalization and conflicts: the good, the bad and the ugly of corporations in Africa

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  • Sonno, Tommaso
Abstract
Using georeferenced data on the affiliates and headquarters of multinational enterprises together with georeferenced conflict data, this work is the first to establish a causal link between the activities of multinational enterprises and violence. The results indicate that activities which increase local human capital, such as education and health, decrease the probability of civil conflict, while the activity of sectors intense in scarce resources, in particular forestry, increases conflict. The increase in the likelihood of conflict is amplified especially in areas where the leading ethnic groups can place the burden of land deals on unrepresented groups.

Suggested Citation

  • Sonno, Tommaso, 2020. "Globalization and conflicts: the good, the bad and the ugly of corporations in Africa," LSE Research Online Documents on Economics 108225, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:108225
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    References listed on IDEAS

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    Cited by:

    1. Giacomo Battiston & Matteo Bizzarri & Riccardo Franceschin, 2021. "Third-Party Interest, Resource Value, and the Likelihood of Conflict," CSEF Working Papers 631, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 20 Jun 2022.
    2. Del Prete, Davide & Di Maio, Michele & Rahman, Aminur, 2023. "Firms amid conflict: Performance, production inputs, and market competition," Journal of Development Economics, Elsevier, vol. 164(C).
    3. Sonno, Tommaso & Zufacchi, Davide, 2022. "Epidemics and rapacity of multinational companies," LSE Research Online Documents on Economics 117802, London School of Economics and Political Science, LSE Library.
    4. Hoekman, Bernard & Sanfilippo, Marco & Tambussi, Margherita, 2023. "Foreign Direct Investment and Structural Transformation in Africa," CEPR Discussion Papers 17838, C.E.P.R. Discussion Papers.
    5. Giacomo Battiston & Matteo Bizzarri & Riccardo Franceschin, 2024. "Third parties and the non-monotonicity of the resource curse: Evidence from US military influence and oil value," CSEF Working Papers 701, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    6. Vrolijk, Kasper, 2023. "How does globalisation affect social cohesion?," IDOS Discussion Papers 5/2023, German Institute of Development and Sustainability (IDOS).

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    More about this item

    Keywords

    multinationals; civil conflict; FDI; ethnic minority;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L70 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - General
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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