Comparative Economic Studies

, Volume 51, Issue 2, pp 242–264 | Cite as

Rationality as a Barrier to Peace: Micro-evidence from Kosovo

  • Sumon Kumar Bhaumik
  • Ira N Gang
  • Myeong-Su Yun
Regular Article


Despite a significant expansion of the literature on conflicts and fragility of states, only a few systematic attempts have been made to link the theoretical literature on social conflicts to the available micro-level information about the people who are involved in these conflicts. We address this lacuna in the literature using a household-level data set from Kosovo. Our analysis suggests that it is individually rational for competing ethnic communities, Kosovar Albanians and Kosovar Serbs, to resist a quick agreement on a social contract to share the region's resources.


conflict individual rationality economic deprivation micro-evidence Balkans Kosovo 

JEL Classifications

D63 D74 D78 


  1. Abadie, A and Gardiezabal, J . 2001: The economic costs of conflict: A case-control study of the Basque country. National Bureau of Economic Research Working paper no. 8478, Cambridge, Massachusetts.Google Scholar
  2. Acemoglu, D . 2003: Why not a political Coase theorem? Social conflict, commitment, and politics. Journal of Comparative Economics 31 (4): 620–652.CrossRefGoogle Scholar
  3. Addison, T and Murshed, SM . 2001: From conflict to reconstruction: Reviving the social contract. WIDER Discussion paper no. 2001/48, WIDER – United Nations University: Helsinki.Google Scholar
  4. Artisien, PFR . 1984: A note on Kosovo and the future of Yugoslav–Albanian relations: A Balkan perspective. Soviet Studies 36 (2): 267–276.CrossRefGoogle Scholar
  5. Arum, R and Shavit, Y . 1995: Secondary vocational education and the transition from school to work. Sociology of Education 68 (3): 187–204.CrossRefGoogle Scholar
  6. Azam, JP and Mesnard, A . 2003: Civil war and social contract. Public Choice 115 (3): 455–475.CrossRefGoogle Scholar
  7. Azar, EE, Jureidini, P and McLaurin, R . 1978: Protracted social conflict: Theory and practice in the Middle East. Journal of Palestine Studies 8 (1): 41–60.CrossRefGoogle Scholar
  8. Bellamy, AJ . 2001: Human wrongs in Kosovo, 1974–99. In: Booth, K (ed). The Kosovo Tragedy: The Human Rights Dimensions. Frank Cass: London. pp. 105–126.Google Scholar
  9. Bhaunik, SK and Nugent, JB . 1999: An analysis of food demand in Peru: Implications for food-feed competition. Review of Development Economics 3 (3): 242–257.Google Scholar
  10. Bhaumik, SK and Nugent, JB . 2000: Wealth accumulation, fertility, and transfers to elderly households in Peru. In: Mason, A and Tapinios, G (eds). Sharing the Wealth. Oxford University Press: New York. pp. 256–281.Google Scholar
  11. Bhaumik, SK, Gang, IN and Yun, M-S . 2006: Ethnic conflict and economic disparity: Serbians and Albanians in Kosovo. Journal of Comparative Economics 34 (4): 754–773.CrossRefGoogle Scholar
  12. Buvinic, M and Gupta, GR . 2001: Female-headed households and female-maintained families: Are they worth targeting to reduce poverty in developing countries. Economic Development and Cultural Change 45 (2): 259–280.CrossRefGoogle Scholar
  13. Colletta, NJ and Cullen, ML . 2000: Violent conflict and the transformation of social capital: Lessons from Cambodia, Rwanda, Guatemala and Somalia. World Bank: Washington, DC.Google Scholar
  14. Collier, P . 1999: On the economic consequences of civil war. Oxford Economic Papers 51 (1): 168–183.CrossRefGoogle Scholar
  15. Collier, P and Hoeffler, A . 1998: On economic causes of civil war. Oxford Economic Papers 50 (4): 563–573.CrossRefGoogle Scholar
  16. Collier, P and Hoeffler, A . 1999: Justice-seeking and loot-seeking in a civil war. World Bank unpublished manuscript, Washington, DC (
  17. Esteban, J and Ray, D . 1999: Conflict and distribution. Journal of Economic Theory 87 (2): 379–415.CrossRefGoogle Scholar
  18. Esteban, J and Ray, D . 2008: On the salience of ethnic conflict. American Economic Review 98 (5): 2185–2202.CrossRefGoogle Scholar
  19. Falk, A, Fehr, E and Fischbacher, U . 2003: Reasons for conflict: Lessons from bargaining experiments. Journal of Institutional and Theoretical Economics 159 (1): 171–187.CrossRefGoogle Scholar
  20. Foster, J, Greer, J and Thorbecke, E . 1984: A class of decomposable poverty measures. Econometrica 52 (3): 761–766.CrossRefGoogle Scholar
  21. Gallagher, T . 2005: The Balkans in the new millennium: In the shadow of war and peace. Routledge: London and New York.Google Scholar
  22. Grubb, WN . 1993: The varied economic returns to post-secondary education: New evidence from the class of 1972. Journal of Human Resources 28 (2): 365–382.CrossRefGoogle Scholar
  23. Hirshleifer, J . 1995: Anarchy and its breakdown. Journal of Political Economy 103 (1): 26–52.CrossRefGoogle Scholar
  24. Kostovicova, DD and Bechev, D . 2004: Kosovo: Successes and failures of international civil and military involvement. Centre for the Study of Global Governance Discussion paper no. 31, London School of Economics and Political Science: London, UK.Google Scholar
  25. Maitra, P and Ray, R . 2003: The effect of transfers on household expenditure patterns and poverty in South Africa. Journal of Development Economics 71 (1): 23–49.CrossRefGoogle Scholar
  26. McKinley, T and Alarcon, D . 1995: The prevalence of rural poverty in Mexico. World Development 23 (9): 1575–1585.CrossRefGoogle Scholar
  27. Moene, K . 1992: Poverty and landownership. American Economic Review 82 (1): 52–64.Google Scholar
  28. Miguel, E, Satyanath, S and Sergenti, E . 2004: Economic shocks and civil conflict: An instrumental variables approach. Journal of Political Economy 112 (4): 725–752.CrossRefGoogle Scholar
  29. O’Neill, WG . 2002: Kosovo: An unfinished peace. Lynne Rienner Publishers Inc.: London.Google Scholar
  30. Pezzin, LE and Schone, BS . 1998: Intergenerational household formation, female labour supply and informal care giving. Journal of Human Resources 34 (3): 475–503.CrossRefGoogle Scholar
  31. Scott, FA, Berger, MC and Garen, JE . 1995: Do health insurance and pension costs reduce the job opportunities of older workers? Industrial and Labour Relations Review 48 (4): 775–791.CrossRefGoogle Scholar
  32. Skarperdas, S . 1992: Cooperation, conflict and power in the absence of property rights. American Economic Review 82 (4): 720–739.Google Scholar
  33. Stanley, TD and Jarrell, SB . 1998: Gender wage discrimination bias? A meta-regression analysis. Journal of Human Resources 33 (4): 947–973.CrossRefGoogle Scholar
  34. Stewart, F . 2002: Horizontal inequalities as a source of conflict. In: Hampson, F and Malone, D (eds). From Reaction to Prevention: The Opportunities for the UN System. Lynne Rienner Publishers: London. pp. 105–136.Google Scholar
  35. Waller, M, Drezov, K and Gokay, B . 2001: Kosovo: The Politics of Delusion. Routledge: London.Google Scholar
  36. World Bank. 2001: Kosovo: Poverty assessments, 2 volumes. Report no. 23390-KOS, Washington, DC.Google Scholar

Copyright information

© Palgrave Macmillan 2009

Authors and Affiliations

  • Sumon Kumar Bhaumik
    • 1
    • 2
    • 3
  • Ira N Gang
    • 2
    • 4
  • Myeong-Su Yun
    • 2
    • 5
  1. 1.Department of Economics and FinanceBrunel UniversityUxbridgeUK
  2. 2.IZA – Institute for the Study of LabourBonnGermany
  3. 3.William Davidson Institute, University of MichiganAnn ArborUSA
  4. 4.Department of EconomicsRutgers UniversityNew BrunswickUSA
  5. 5.Department of EconomicsTulane UniversityNew OrleansUSA

Personalised recommendations