Climate Shocks, Price Dynamics, And Human Conflict

Type Working Paper
Title Climate Shocks, Price Dynamics, And Human Conflict
Author(s)
Publication (Day/Month/Year) 2016
Abstract
How do climate shocks impact human conflict? Growing evidence demonstrates that increases in ambient temperature and anomalous variation in rainfall significantly increase the risk of subnational conflict. These patterns are commonly attributed to two mechanisms: direct, heat-induced aggression, and indirect, economic disruption. This article addresses how various forms of violence—from spontaneous, individual aggression to organized, insurgent operations— respond to similar climate shocks. We also investigate how weather conditions impact local prices of staple goods, and use an instrumental variables approach to disentangle the direct, physiological and indirect, economic mechanisms underlying the climate-conflict relationship. We evaluate these questions in the context of Indonesia using high-resolution climatic, consumer price, and agricultural data, and exploit the most comprehensive microdata on violent crime, communal violence, and insurgent operations currently available for academic research. We focus on three findings. First, interpersonal violence increases significantly as ambient temperatures rise, while the frequency of insurgent operations exhibits the opposite relationship. A standard deviation increase in ambient temperature, for example, increases the frequency of battery and assault by 15%. The same temperature shock decreases the intensity of insurgent fighting by 24%. Second, climatic conditions in agricultural sub-districts drive subnational variation in consumer prices. Third, climate-induced increases in consumer prices drive up non-economic and economic violent crime, but only in sub-districts that rely on production elsewhere for rice, soybeans, and other essential commodities. Importantly, these forms of interpersonal violence remain unchanged or decline in rice and soybean producing sub-districts as farmgate prices rise. These findings are robust to accounting for numerous potential sources of bias, including measurement error due to highly variable microclimates, exposure to subnational market fragmentation, and the introduction of surface water irrigation technologies. Our results clarify how climate shocks influence the occurrence of human conflict, challenge prominent findings in recent scholarship, and yield implications for policy-makers crafting interventions to reduce violence associated with contemporary and projected climate shocks.

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