War and Natural Resource Exploitation

We build a theoretical framework that allows for endogenous conflict behaviour (i.e., fighting efforts) and for endogenous natural resource exploitation (i.e., speed, ownership, and investments). While depletion is spread in a balanced Hotelling fashion during peace, the presence of conflict creates incentives for rapacious extraction, as this lowers the stakes of future contest. This voracious extraction depresses total oil revenue, especially if world oil demand is relatively elastic and the government's weapon advantage is weak. Some of these political distortions can be overcome by bribing rebels or by government investment in weapons. The shadow of conflict can also make less efficient nationalized oil extraction more attractive than private extraction, as insecure property rights create a holdup problem for the private firm and lead to a lower license fee. Furthermore, the government fights less intensely than the rebels under private exploitation, which leads to more government turnover. Without credible commitment to future fighting efforts, private oil depletion is only lucrative if the government's non-oil office rents are large and weaponry powerful, which guarantees the government a stronger grip on office and makes the holdup problem less severe.

The Swiss Willensnation at Risk: Teachers in the Cultural Gap during the First World War

As a neutral and multilingual country, Switzerland struggled with major domestic political conflicts during the First World War due to the two cultures of the French-speaking and German-speaking parts of the country. The divided cultural loyalties ('fossé moral', 'Röstigraben'), consisting of Swiss-Germans supporting Germany and Swiss-French supporting France, were discussed intensively in both of the main teachers' journals in Switzerland. Teachers felt the need to react and to promote unity from the beginning of the war. Despite the fact that the cantons are responsible for public education and, therefore, for the education of their students, teachers considered themselves called to educate their students to be national citizens rather than to be members of a language group. This threefold citizenship - communal, cantonal and national - was not scrutinised, but national unity became crucial due to the critical political circumstances. How did teachers promote and constitute citizenship for themselves and for their students in a nation united by free will during the First World War, a time of severe internal political conflicts?

War Signals: A Theory of Trade, Trust and Conflict

We construct a dynamic theory of civil conflict hinging on inter-ethnic trust and trade. The model economy is inhabitated by two ethnic groups. Inter-ethnic trade requires imperfectly observed bilateral investments and one group has to form beliefs on the average propensity to trade of the other group. Since conflict disrupts trade, the onset of a conflict signals that the aggressor has a low propensity to trade. Agents observe the history of conflicts and update their beliefs over time, transmitting them to the next generation. The theory bears a set of testable predictions. First, war is a stochastic process whose frequency depends on the state of endogenous beliefs. Second, the probability of future conflicts increases after each conflict episode. Third, "accidental" conflicts that do not reflect economic fundamentals can lead to a permanent breakdown of trust, plunging a society into a vicious cycle of recurrent conflicts (a war trap). The incidence of conflict can be reduced by policies abating cultural barriers, fostering inter-ethnic trade and human capital, and shifting beliefs. Coercive peace policies such as peacekeeping forces or externally imposed regime changes have instead no persistent effects.