This study asks whether foreign direct investment (FDI) entering countries after civil conflict helps economic recovery and, through that recovery, reduces the chance of conflict recurring. Using country-level intrastate conflict data spanning 1970–2019, the authors estimate mediation models that link post-conflict FDI to economic reconstruction and then to subsequent conflict risk, and they provide replication files for their analysis.
two-stage generalized structural equation models intrastate armed conflict data from 1970 to 2019 post-conflict FDI increases the magnitude of economic reconstruction
Data and methods
The analysis uses intrastate armed conflict data covering 1970–2019 and measures of post-conflict FDI and economic reconstruction. The authors employ two-stage generalized structural equation models to test whether economic recovery mediates any effect of FDI on the probability of conflict recurrence. Replication files for the project are provided alongside the article.
Main findings
The abstract reports that the empirical results "appear to show" that post-conflict FDI is associated with larger economic reconstruction and that this is linked indirectly to a lower probability of conflict recurrence; the authors describe these results as consistent with a mediation mechanism but phrase them cautiously.
- Post-conflict FDI is associated with greater economic reconstruction.
- Greater economic reconstruction is associated with reduced grievances and an indirect decrease in conflict recurrence.
