DP14635 A Dynamic Theory of Secessionist vs Centrist Conflict

Author(s):	Joan Esteban, Sabine Flamand, Massimo Morelli, Dominic Rohner
Publication Date:	April 2020
Keyword(s):	conflict, Patience, Secessions, Surplus Sharing
JEL(s):	C7, D74
Programme Areas:	Public Economics
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=14635

This paper proposes an integrated dynamic theory of bargaining and conflict between ethnic groups, delivering novel predictions on secessionist versus centrist conflict. Ethnic identities, inequality and intertemporal preferences are predicted to impact the risk of secessionist conflict and the risk of centrist conflict in different directions. Beside obtaining a full characterization of equilibrium for every set of conditions, we also show empirical evidence that cultural similarity reduces the scope for secessionist conflict (compared to centrist conflict); that small ethnic groups stick more often to peaceful union; that higher patience and higher group inequality fuels secessionism.