Diasporas and Conflict

Transcription

1 Diasporas and Conflict Fabio Mariani, Marion Mercier, Thierry Verdier Abstract In this paper, we study the relation between emigration and conflict in developing countries, which has been overlooked by the economic literature. We build a model of conflict, in which two (ethnic) groups contest a given resource that can be consumed as a (group-specific) public good. Open conflict requires labor, and involves the destruction of some of the contested resource. Within each group, agents collectively decide on the optimal allocation of labor (i.e. ex-ante identical group members) between conflict and productive activities. Given the characteristics of the implied Nash equilibrium, in terms of conflict intensity and outcome, the two groups may also choose to negotiate a pacific settlement if there exists a sharing rule that makes both of them better off than conflict. In this setting, we introduce migration from one of the two groups. We develop two configurations of the model in which emigrants participate or not in the collective decision of their group in the homeland. We find that diaspora may trigger a switch from peace to war in the origin country, provided that the stock of migrants exceeds a given threshold. This results is always true when emigrants are involved in the collective decision. When they are not, their peace-wrecking or peace-building impact depends on the home country s characteristics. Moreover, we show that diaspora-induced conflict is initiated by the group to which migrants belong in the first case, and by the other group in the second configuration. The model is further extended to account for (i) consumption-targeted remittances, (ii) diasporas actively involved in the homeland conflict (by lobbying abroad, through soft-power, etc.), and (iii) migration from both groups. Our results are broadly consistent with available anecdotal evidence. Fabio Mariani: IRES, Université catholique de Louvain; Paris School of Economics; IZA, Bonn. fabio.mariani@uclouvain.be Marion Mercier: Paris School of Economics; DIAL - IRD. mercier@dial.prd.fr Thierry Verdier: Paris School of Economics. thierry.verdier@ens.fr 1

2 1 Introduction This paper investigates the mechanisms through which diasporas may intervene in the dynamics of conflict in the homeland. We build a theoretical framework to characterize the conditions under which, and the channels through which, diasporas may affect civil conflict in the home country. Anecdotal evidence, notably concerning the African East Horn, Eastern Europe or Israel, attests to the role that some diasporic groups have played from abroad in conflicts in their homeland. One of the probably most talkative examples of this phenomenon is related to the Sri Lankan civil war, that has claimed around 100,000 lives from 1983 to 2009 according to the United Nations. The Tamil diaspora has been a decisive actor in the evolution of this conflict. It first contributed to the escalation of violence, by financially sustaining the main Tamil armed group, the Liberation Tigers of Tamil Eelam. Described by Joshi (1996) as the economic backbone of the militant campaign, the Tamil diaspora built a well-organized global network of offices and cells covering at least 40 countries, able to channel funds on a very large scale (Fair, 2007). Gunaratna (2003) estimates that the LTTE had an annual income close to 100 million dollars, of which the diaspora had contributed at least 60 million per year. A large amount of voluntary remittances from the diaspora members thus reached the coffers of the LTTE. The worldwide network of the LTTE also relied on force or on intimidation to gather donations collected like a tax (Fair, 2007; Orjuela, 2008). In addition to its financial involvement, the Tamil diaspora brought important political contributions that influenced the evolution of the conflict in Sri Lanka. It notably developed lobbying and publicity efforts, directed toward the host countries governments as well as civil societies, to mobilize international support and seek political sympathy for its cause. 1 At the end of nineties, the main migrants host countries (following the US in 1997) designated the LTTE as a Foreign Terrorist Organization. In the aftermath of September 11, the suspicion over the funds channeled by the Tamil diaspora became even stronger. This reduced the LTTE s ability to raise revenue from the diaspora (Fair, 2007). It also reduced the diaspora members willingness to be considered as associated with the 1 The message propagated by the Tamil diaspora during the conflict, according to Fair (2007), was three-fold. It first conveyed the image of the Sri Lankan Tamils as victims of discrimination and military repression coming from the Sinhalese regime. Second, it presented the LTTE as the single legitimate voice of the Sri Lankan Tamils. It finally emphasized the impossibility of achieving peace in the absence of an independent Tamil state. 2

3 LTTE, an organisation labeled as terrorist, and gave space to individuals and organisations that advocated for non-violent conflict resolution and power-sharing settlements (Orjuela, 2008). The Tamil diaspora eventually started to push for peace from the beginning of the 2000s, and provided important competence in the peace process. 2 The Sri Lankan Tamil example provides interesting instances of the diverse forms of diasporas potential involvement in the evolution of conflict in the homeland. Anecdotal evidence can also be found in very different contexts. Croat emigrants for instance largely intervened in the war for independence. The diaspora brought strong support and financial assistance to Tudjman s Croatian Democratic Union (HDZ), which led the secession from the former Yugoslavia and the transition to a market-led economy. During the escalatory phase of the conflict ( ), most diaspora funds were used to finance the political activities of the opposition with whom the diaspora shared its willingness to oust the communist government and take concrete steps toward independence (Skrbiš, 2007). Through a donation of 4 million dollars, the diaspora funded most of the 1990 election campaign won by the HDZ (Glenny, 1995). Following this victory, 12 seats over 127 in the parliament were reserved for diaspora representatives, and diaspora members were elevated to positions of significance in the new government (Skrbiš, 2007). After the declaration of independence of Croatia in June 1991, the focus of the diaspora shifted toward the country s defense. According to Hockenos (2003), more than 50 million dollars flowed from the diaspora toward the HDZ between 1991 and 1995, during the hot conflict stage. As in the Tamil case, Skrbiš (2000) notes that financial participation was nearly mandatory for the Croatian diaspora members. Finally, he underlines that many diaspora resources were also used for campaigning in the host countries, lobbying the host governments for recognition of the new state, and seeking support from the international community. In a different context, lobbying activities were particularly developed by the Cuban diaspora in the United States. Thus, the Cuban-American National Foundation, according to Grugel and Kippin (2007), established near-hegemonic control over Cuban-American politics in the 1980s. The diaspora was notably strongly involved in the Bay of Pigs counter-revolution attempt in Orjuela (2008) notably underlines the strong involvement of the diaspora in the proposal for an interim governance structure for the northeast region that the LTTE formulated in

4 Following the end of the Cold War, the Cuban diaspora succeeded in keeping Cuba at the top of the US foreign policy agenda, notably thanks to its electoral weight in the swinging state of Florida (Eckstein, 2009; Haney and Vanderbush, 1999). Although the lobbying activities of the Cubans in the US which aimed at overthrowing Castro were de facto not successful, it is clear that the diaspora strongly affected the US foreign policy and the ability of the political regime in the homeland to carry on. Since the recent waves of migrants contributed to making the diaspora more eclectic and less radical, it is now potentially able to play a bridging role between Cuba and the US and to become a peace-builder actor if a negotiated transition to democracy is achieved (Grugel and Kippin, 2007). Eritrean migrants have also played an active role from abroad in the homeland struggles. From the beginning of the 1960s, the diaspora has maintained links with the Eritrean People s Liberation Front (EPLF) and financially supported its struggle for independence (Bernal, 2004). The involvement of the diaspora did not cease after the independence. From 1991, the Eritrean state notably asked the diaspora to contribute two per cent of their monthly income to the Eritrean government (Fessehatzion, 2005). This contribution was not compulsory but different qualitative surveys show that most abroad-living Eritrean considered it as a duty (Koser, 2007). The diaspora also played a direct political role after the independence and was largely involved in the process of drafting the constitution, which culminated with the ratification of Pirkkalainen and Abdile (2009) thus emphasize the contributions of the diaspora toward peace and reconstruction in the post-conflict period. In parallel to this peace-building efforts, Koser (2007) notes that although the Eritrean community [was] well organized internally, it [was] not organized in terms of external affairs. He underlines in particular the within-diaspora divisions, based on regionalism, religion or politics. The four examples that we have briefly presented here show that, through various means, diasporas have been able to support the escalation of violence or to contribute to peace-building in different circumstances. A large literature in political sciences documents diverse channels through which different diasporas have influenced the dynamics of conflict at home. 3 It derives two main dimensions of diasporas involvement in conflict in the homeland. First, migrants send money. 3 See notably Smith and Stares (2007). 4

5 These financial flows, generally targeting migrants family, redefine the recipient households budget constraint and hence affect non-migrants ability to engage in conflict as well as the opportunity cost associated with their involvement in the conflict. Through family-level remittances, migrants thus play a role in the evolution of the conflict. Remittances can also be directly targeted toward insurgent groups: in this case the capacity of migrants to affect the dynamics of conflict appears even more clearly. Second, the political sciences literature underlines that diasporas rely on the available political opportunity structures to intervene in the conflict in the homeland. Political opportunity structures are defined by Smith (2007) as the set of power relations (within a diaspora and between diaspora, home and host countries) that are determinant of the ability of diasporas to intervene and of the nature of diasporas input to the conflict. Relying on the existing transnational political opportunity structures, a diaspora can mobilize different soft power tools to influence the evolution of the conflict, such as lobbying toward the host governments or spreading information in the international media. Transnational political opportunity structures also shape the nature of migrants intervention in the conflict. In the frame of the Sri Lankan Tamil example we presented above, the evolution of the available political opportunity structures in the aftermath of September 11 contributed to the switch in the nature of the diaspora s involvement. In spite of this much documented anecdotal evidence, the economic literature does not provide a framework to analyze the implication of diasporas in conflict dynamics. Numerous papers document the effects of migration on migrants origin country but none of them, to our knowledge, considers the onset and intensity of civil conflict as outcomes potentially affected by migration. However, a recent strand of this literature provides mostly empirical evidence that migrants affect politics at home. In particular, Spilimbergo (2009) shows that foreign students have a positive impact on democracy in their home country. In the same vein, Docquier et al. (2013), emphasize a positive effect of openness to emigration on home-country institutional development. Consistently with these macro results, a few micro-oriented papers document the impact of migration on political behaviours or opinions in the origin communities. Batista and Vicente (2011) notably find that Cape-Verdean non-migrants living in more migration-intensive localities exhibit higher demand for political accountability. Relying on electoral results, the first chapter of this dissertation suggests 5

6 that Malian return migrants transfer electoral norms to their origin communities, in particular in terms of participation. Finally, Pfutze (2012) and Omar Mahmoud et al. (2013) respectively put forward a positive impact of migration intensity on the probability that an opposition party wins a municipal ballot in Mexico, and a negative impact of migration intensity on the support for the Communist party in the parliamentary elections in Moldova. These papers thus provide evidence, both at the macro and at the micro level, that migrants affect political institutions and behaviors at home. Such results, combined with anecdotal evidence attesting to the role that some diasporic groups have played from abroad in conflicts in their homeland, pave the way for the research question we ask in this paper. On the other hand, the rich economic literature on conflict fails at taking into account the existence of the potential third actor that migrants represent, and thus does not provide a theoretical framework to analyze their influence on the evolution of conflicts. 4 On the empirical side, Collier and Hoeffler (2004) put forward a positive correlation between the proportion of natives living in the US and the probability of conflict onset in the home country. They argue that migrants funding can spark conflict, and that diasporas represent a significant risk factor in the re-ignition of wars once they have abated. Although the methodology implemented as well as the measure of diaspora used in their estimations do not allow to derive sharp conclusions on causality, the result that they provide calls for further investigation, both empirical and theoretical. This paper is a first step in the latter direction. We present a simple game-theoretic model of conflict between two (ethnic) groups contesting a given resource that can be consumed as a (group-specific) public good. Open conflict requires labor, and involves the destruction of some of the contested resource. Within each group, agents collectively decide on the optimal allocation of labor (i.e. of ex-ante identical group members) between participation in the conflict and productive activities. Given the characteristics of the implied Nash equilibrium in terms of conflict intensity and of conflict outcome, the two groups may also choose to negotiate a pacific settlement if there exists a sharing rule that makes both of them 4 In their survey of the civil war literature in economics, Blattman and Miguel (2010), after highlighting the major role that diasporas often play in rebel finance, point out an important limitation of the existing theoretical work on armed conflict causes, namely its almost exclusive focus on the internal armed groups decision of whether or not to fight. 6

7 better off than conflict. In this setting, we introduce a pre-existing diaspora emanating from one of the two groups. By pre-existing diaspora, we mean that we consider the size of the diaspora as exogenous to the conflict. It is clear that migration intensity is also affected by the conflict, notably because it triggers flows of refugees trying to escape from violence. Endogeneizing migration thus represents the next step in the research direction taken here. As a first approach, considering the size of the diaspora as exogeneous to the conflict is however not only an artificial methodological choice. It is indeed consistent with cases of diasporas that mostly gather economic migrants. Although it is very difficult to disentangle economic migration from conflict-generated migration in the cases of countries at war (economic downturn being also both a potential cause and an outcome of conflict), the qualitative literature that we referred to in the first part of this introduction enlightens the motives of the different migration waves that built each diaspora. For instance, Skrbiš (2007) recalls that a long-lasting Croat tradition of emigration preceded the constitution of the diasporic shared political identity. After the flows of refugees that were triggered by the birth of the Yugoslav state at the end of World War II, he underlines that most of those who then joined the ranks of the Croatian diaspora were economic migrants. Symmetrically, after the exile of politically active Cubans right after the revolution of 1959 and during the Mariel boatlift in the 1980s, the end of the Cold War coincided with the first migration agreement between Cuba and the United States, and gave birth to what Molyneux (1999) refers to as a purely economic diaspora. We develop two configurations of the model in which diaspora members participate or not in the collective decision of their group in the homeland. We find that diasporas may trigger a switch from peace to war in the origin country, provided that the stock of migrants exceeds a given threshold. This result is always true when emigrants are involved in the collective decision. When they are not, their peace-wrecking or peace-building impact depends on the home country s characteristics. Moreover, we show that diaspora-induced conflict is initiated by the group to which migrants belong in the first case, and by the opposite group in the second configuration. The model is further extended to account for (i) consumption-targeted remittances, (ii) diasporas actively involved in the homeland conflict (by lobbying abroad, through soft-power, etc.), and 7

8 (iii) migration from both groups. Our results are broadly consistent with anecdotal evidence on diasporas being peace-builders in certain contexts, and peace-wreckers in others. The rest of the paper is organized as follows. We introduce in the following section the benchmark version of the model, in which we consider that the group-level utility accounts both for residents and for migrants. Section 3 investigates the alternative specification, assuming that the group-level utility only considers residents, and compares its results with the predictions derived from the benchmark model. Section 4 further develops this second specification by adding the possibility that the diaspora plays a strategic role in the conflict, for instance through lobbying from abroad. Section 5 explores the impact of bilateral migration (i.e., the existence of two diasporas emanating from the two groups) on the two versions of the model, and Section 6 finally concludes. 2 The basic setup We start by presenting the benchmark version of the model, in which migration concerns one of the two groups at play, and each group is led by a social planner who maximizes the average utility of all the group s members, whatever their location. 2.1 The economic environment Consider a country whose population is normalized to 1 and divided into two groups: the (ruling) elite (E) and the oppressed group (O), which respectively account for the shares ɛ and (1 ɛ) of the population. All the members of group E are supposed to reside in the homeland, and are characterized by a productivity y E. On the contrary, within the (1 ɛ) members of group O, a share m lives abroad. 5 Residents of group O are characterized by a productivity y O while that of migrants is larger and equal to (1 + µ)y O. Without loss of generality we can assume y E = κy O = κy, with κ > 0, so that y can be interpreted as the overall level of development of the economy while κ is a measure of between-group inequality. Note that if we do not make any additional assumption on κ (whether it is initially smaller or greater than 1) we cannot know whether an increase in κ corresponds to 5 The case of two diasporas will be analyzed in Section 5. 8

9 an increase or a decrease of the between-group inequality. Each group is led by a social planner who aims at maximizing the group s average utility, including migrants for group O. We identify this specification as the global social planner case. Later on we will consider an alternative specification of the model in which decisions are taken by a local social planner, who does not care about migrants utility. As in Esteban and Ray (2008) and Esteban and Ray (2011), individual utility is derived from private consumption c, and from a public good Q that depends on the appropriation of a given resource R. Since the members of group E are all alike, the leader of group E maximizes the following average utility function: u E = c E + χq E, (1) where χ denotes the preference for the public good. The leader of group O maximizes: u O = (1 m)c O,r + mc O,m + χq O, (2) where c O,r stands for residents of group O s private consumption while c O,m represents migrants private consumption. Hereby we are suggesting that members of group O, regardless of their location, have the same taste for and the same access to the public good but may differ in their private consumption. 6 We also assume that the preference for the public good, χ, is the same for both groups residents and for migrants. The quantity Q i (i = E, O) of public good that each group can have access to depends on the appropriation of a contested resource R. It can be either subject to violent conflict or shared through a process of negotiation. In the first case, group E (respectively, O) obtains a share s (respectively, 1 s) of R, where s 6 Assuming that migrants are interested in the public good contested in the homeland appears consistent with examples of diasporas being highly involved in the political situation in their home country. Public goods in their origin country may also be decisive for their ability to migrate back home. 9

10 is given by the following contest function: s(a E, A O ) = γa E γa E + (1 γ)a O. (3) A i (i = E, O) denotes the number of soldiers (or activists) that group i allocates to conflict, and γ represents the relative advantage of group E in conflict. It reflects the idea that, prior to conflict, the elite has an easier access to conflict-related information or technology, for instance. s can be alternatively interpreted as the probability that group E will capture the whole amount of resource R. Open conflict is costly: it entrains the destruction of a share δ of the total resources located or produced in the economy, i.e. residents private production and R. Migrants are thus not concerned by the destructive effect of war on private production. Note also that individuals who are employed as soldiers are removed from productive activities so that, for instance, group E gives up a total quantity of private consumption equal to A E c E. In the second case, the two groups engage in a process of negotiation and must ultimately agree on shares s and 1 s. Negotiation does not entrain any destruction, but it costs the amount Z to each group. The justification for Z is that negotiation might be time- or resource-consuming, or that past conflicts (hatred) make, to some extent, the two groups prefer war over pacific settlement. It can also encapsulate the idea that there is no perfect commitment technology associated with the peaceful settlement of the conflict. 2.2 The model with conflict Suppose now that R is contested through violent conflict. The leaders of the two groups must decide on the share of the labor force that they allocate to conflict. More precisely, the leader of group E chooses θ E such that A E = θ E ɛ and the leader of group O chooses θ O such that A O = θ O (1 ɛ)(1 m), since migrants cannot be recruited as soldiers. Assuming that all the productive income is transformed into private consumption, u E and u O 10

11 in case of war can be written as: u E,w = (1 δ)((1 θ E )κy + χs(a E, A O )R), (4) and u O,w = (1 δ)(1 θ O )(1 m)y + my(1 + µ) + (1 δ)χ(1 s(a E, A O ))R, (5) respectively. The first order conditions u E / θ E = 0 and u O / θ O = 0 yield the following reaction functions: θ E = (1 m)(1 γ)(1 ɛ)γ 3 ɛ 3 κyθ O χr (1 m)(1 γ)(1 ɛ)κyγɛθ O (γɛ) 2, (6) κy and θ O = (1 m) 2 γɛ(1 γ) 3 (1 ɛ) 3 yθ E χr (1 m)(1 γ)(1 ɛ)yγɛθ E ((1 m)(1 γ)(1 ɛ)) 2. (7) y The graphical representations of these two reaction functions are displayed in Figure 1. Figure 1: The shape of equilibrium responses. θ O θ E (θ O ) θ O (θ E ) θ O 0 θ E θ E 11

12 The intersection between the two reaction functions leads to the following equilibrium: θ E = χr(1 γ)(1 ɛ)γɛ y(κ(1 γ)(1 ɛ) + γɛ) 2, (8) and θ O = χr(1 γ)(1 ɛ)γɛκ (1 m)y(κ(1 γ)(1 ɛ) + γɛ) 2. (9) Proposition 1 At equilibrium, both θ E and θ O increase with R and χ, while they decrease with y. θ E decreases with κ. There also exists a threshold γ = κ(1 ɛ)/(ɛ + κ(1 ɛ)) such that θ E and θ O increase (respectively, decrease) with γ and ɛ if γ < γ (respectively, γ > γ), while θ O is increasing (respectively, decreasing) in κ if γ > γ (respectively, γ > γ). Moreover, θ O increases with m, while θ E does not depend on m. Proof. Follows from the inspection of the partial derivatives of the expressions of θe and θ O given by Equations (8) and (9). In both groups, the share of labor force allocated to war expectedly increases with the amount of contestable resources R and the preference for the public good χ. On the other hand, it decreases with y, which reflects the opportunity cost of allocating workers to conflict. When κ increases, making group E s relative income larger, and thus its relative opportunity cost of conflict higher, the elite chooses to allocate a smaller proportion of its labor force to conflict. On the other hand, the impact of between-group inequality on θ O is non-linear. An increase in κ induces an increase in the share of soldiers in group O if γ > γ, which corresponds to a relatively high efficiency of group E in the conflict as compared to group O. Moreover, the share of labor force allocated to war increases in both groups with the elite s relative power (γ) and size (ɛ) if γ < γ, thus if the elite s relative efficiency in conflict is not too high. Finally, the share of migrants does not affect the proportion of soldiers of group E, but it has a positive impact on the share of labor force that group O allocates to conflict. Notice however that this does not translate into a larger size of group O s army. In fact, A O = (1 m)(1 ɛ)θ O does not depend on m: the higher θo is exactly offset by the shrinking pool of potential soldiers induced by emigration. 12

13 2.3 War versus peace Given the equilibrium value θ i (i = E, O), the leader of group i may prefer to engage in a negotiation rather than initiating conflict. For this to be the case, there must exist a non-empty set of values of s such that the utility of group i in case of war, u i,w, is lower than its utility if a peaceful settlement is reached, u i,p. However, for negotiation to actually take place, there must exist values of s such that both groups are better off without war. Replacing θe and θ O into Equations (4) and (5), the utilities of the two groups in case of conflict can be rewritten as ( (γɛ) 2 ) χr u E,w = (1 δ) κy + (κ(1 γ)(1 ɛ) + γɛ) 2, (10) and ( u O,w = (1 δ) (1 m)y + (κ(1 γ)(1 ) ɛ))2 χr (κ(1 γ)(1 ɛ) + γɛ) 2 + my(1 + µ), (11) respectively. Negotiating peace allows to avoid the destruction δ that is generated by conflict, and to keep all the labor force in the productive sector (θ O and θ E are set to zero). However, it is associated with the fixed cost Z for each group. In case of peace, groups E and O thus reach the following utilities: u E,p = κy + sχr Z, (12) and u O,p = (1 m)y + my(1 + µ) + (1 s)χr Z, (13) respectively. Equalizing utilities at war and at peace leads to the following thresholds of indifference between conflict and peaceful settlement: s E = (1 δ)(γɛ) 2 (κ(1 γ)(1 ɛ) + γɛ) 2 + Z δκy χr, (14) 13

14 u O,p and ( (1 δ)(κ(1 γ)(1 ɛ)) 2 s O = 1 (κ(1 γ)(1 ɛ) + γɛ) 2 + Z (1 m)δy ). (15) χr Proposition 2 There exist two threshold values of s, s E and s O, such that a pacific settlement is viable only if s E < s O. Proof. Solving u E,w = u E,p allows us to determine the threshold level s E such that group E prefers pacific settlement if the peacefully negotiated s is larger than s E. In the same fashion, from u O,w = u O,p we can deduce s O below which group O prefers to negotiate peace. Figure 2 displays the utility functions of groups E and O in case of war and in case of conflict. The values of s that are such that s E < s < s O form the subset of possible sharing rules on which groups E and O are able to agree peacefully, or the peace region. Figure 2: Utilities of groups E and O as functions of s. u i,j u E,p u O,w u E,w 0 s E s O 1 s Notice that group E s tradeoff between war and peace is not affected by m. On the contrary, migration has a negative effect on s O, and thus induces a higher propensity for group O to engage in conflict. In this setting, the diaspora whose members do not incur the cost of destruction, yet enjoy the benefits of war always increases the likelihood of war. 14

15 Although we do not model here the process of peaceful negotiation of s, we can observe that the size of the diaspora has a positive impact on the bargaining power of group O since the maximum s that can be reached in case of peace (namely, s O ) decreases with m. We can also state the following. Lemma 1 There exists a peace-impeding level of migration, ˆm, above which peace is not a possible outcome anymore. Proof. The two groups cannot reach an agreement if s E is greater than s O. This is always the case if m > ˆm, where ˆm solves s O = s E, since s O is a decreasing function of m, while s E does not depend on the size of the diaspora. In particular, ˆm = 1 (( 1 (1 δ)((κ(1 γ)(1 ɛ))2 + (γɛ) 2 ) ) ) δy (κ(1 γ)(1 ɛ) + γɛ) 2 χr 2Z + δy(κ + 1). (16) Figure 3 depicts s O and s E as functions m. The intersection between the two lines corresponds to the maximum size of the diaspora such that peace is possible. On the right hand side of ˆm, the two groups enter in conflict. This threshold ˆm is positively affected by R and χ: when the public good is bigger or relatively more valued by both groups, the diaspora needs to reach a larger size for triggering a switch from peace to war. This is due to the fact that utilities at war increase with R and χ, but utilities at peace increase even more with R and χ given that war destroys part of the public good. On the other hand, ˆm is negatively affected by Z: when peace is more costly, the size of the diaspora that induces a switch from peace to war is lower, and thus the likelihood of war is higher. The effects of the other parameters on ˆm are ambiguous a priori. Lemma 2 While s E decreases with δ and y and increases with Z, s O increases with δ and y and decreases with Z. However, both s E and s O increase with γ and ɛ and decrease with κ. Finally the effect of R and χ on s E and s O is of ambiguous sign. 15

16 Figure 3: Migration and the peace/war tradeoff. s so s E 0 ˆm 1 m Proof. Follows from the inspection of the partial derivatives of the expressions of s E and s O given by Equations (14) and (15). The above lemma tells us that, trivial enough, the size of the peace region (i.e. the distance between s O and s E ) decreases with the cost of peace Z while it increases with the destructiveness of war δ and with y, which reflects the opportunity cost of war. As far as γ, ɛ and κ are concerned, their impact on the size of the peace region is ambiguous a priori because their effects on the two thresholds have the same sign. Moreover, when γ or ɛ increase, or κ decreases, the interval ( s E, s O ) moves to the right, meaning that the feasible peaceful sharing rules will be relatively more favorable to group E. In fact, if the relative power (γ) or the relative size (ɛ) of group E increase, so does its expected outcome in conflict, thus allowing group E to negotiate peace on better terms. Otherwise said, group O would be ready to peacefully accept less favorable sharing rules, in order to avoid war against a more numerous or more powerful enemy. Furthermore, when κ decreases, it implies that the relative opportunity cost of conflict of group E with respect to group O decreases, thus allowing group E 16

17 to appropriate larger shares of R in case of a peaceful settlement. To summarize, in this benchmark specification, migrants are interested in the conflict outcome while they pay a lesser cost for conflict, which leads to an unambiguous peace-wrecking effect of the diaspora. It is worth noting that this impact channels through group O, the group to which migrants belong, while the opposite group s decision is not affected by the size of the diaspora. This model assumes an important capacity of centralization and coordination of the insurgent group in the homeland. From this point of view, it could be associated with the cases of the pre-9/11 Tamil Sri Lankan diaspora and of the Croat diaspora. The peace-wrecking effect of the diaspora that the model predicts is also consistent with anecdotal evidence related to these two examples. Appendix 7.1 presents an extension of this benchmark specification, adding to the model consumption-targeted remittances which appear to have a non-ambiguous peace-building effect. 3 An alternative model In our benchmark model, migrants utility is incorporated into the objective of the leader of group O. Although they are interested in the contested public good, migrants do not see their private consumption hampered by conflict (otherwise said, their income is protected from destruction), and are thus more prone to war. This simple mechanism may explain the peace-wrecking effect of diasporas. Considering that the leader of group O cares about migrants utility (and is able, for instance, to exact contributions from them in order to finance conflict) may be justified in light of the available anecdotal evidence. Some diasporas have notably been shown to financially contribute to conflict in their homeland on a quasi-forced basis. On the other hand, political leaders in origin countries maintain links with the diaspora and seek its support. Migration indeed generates strong transnational ties between the migrant, his origin household, and in a larger perspective his origin community; and homeland politicians often rely on expatriated groups as vectors of enlargement and strengthening of their network. Migrants are also able to vote from abroad in a growing number of countries (132 over 225 countries/territories in the world in ). 7 Source: Comparative data from the ACE Electoral Knowledge Network project, collaborative effort between nine organisations (the International Institute for Democracy and Electoral Assistance (IDEA), the Electoral Institute for Sustainable Democracy in Africa (EISA), Elections Canada, the National Electoral Institute of Mexico (INE), the In- 17

18 However, one may also argue that, in some cases, diasporas have weak ties with homeland politics, and/or migrant communities have a certain autonomy with respect to their group in the homeland and are not easily influenced by home-country politics. In such a case, it would make little sense to introduce migrants utility in the objective of the leader of group O, who would rather act as a local social planner. In this section, we want to check whether the result of peace-wrecking diasporas emphasized in Section 2 is robust to the removal of migrants utility from the objective of group O. 3.1 Setting up the model with local social planner With respect to our benchmark model, the only difference concerns the average utility maximized by group O, which now takes the following form (group O s social planner accounting only for residents): u l O,w = (1 δ)((1 θo)y l + χ(1 s(a l E, A l O))R), (17) where the superscript l refers to the case of a local planner. Solving the model as we did in Section 2, we can retrieve the reaction functions of the two groups, and determine the implied equilibrium as defined by: θ l E = (1 m)χr(1 γ)(1 ɛ)γɛ y((1 m)κ(1 γ)(1 ɛ) + γɛ) 2, (18) and θ l O = (1 m)χr(1 γ)(1 ɛ)γɛκ y((1 m)κ(1 γ)(1 ɛ) + γɛ) 2. (19) Proposition 3 The effects of all the parameters but m on θ l E and θl O are qualitatively the same as in Proposition 1, once we replace γ by γ l = (1 m)(1 ɛ)κ/(ɛ + (1 m)(1 ɛ)κ). Moreover, both θ l E and θl O increase with m if γ < γl. Proof. Follows from the inspection of the partial derivatives of the expressions of θ l E and θl O given by Equations (18) and (19). ternational Foundation for Electoral Systems (IFES), the Carter Center, the United Nations Department of Economic and Social Affairs (UNDESA), the United Nations Development Program (UNDP) and the United Nations Electoral Assistance Division (UNEAD)). Data available at 18

19 If war occurs in the case of a local social planner, migration does not only affect the share of soldiers in group O, but also in group E. A larger diaspora is associated with larger shares of soldiers in both groups if γ < γ l, that is if the relative effectiveness of group E in conflict is not too high. In the opposite case, a larger diaspora induces a lower proportion of soldiers both in group E and in group O. Concerning the total number of soldiers, while the effect of m on θ l E translates into an effect of the same sign on A l E (migration having a positive impact on the size of the army of group E if γ < γ l ), the same does not hold for group O. Since A l O = (1 m)(1 ɛ)θl O, a larger diaspora always makes the number of soldiers in group O decrease. 3.2 War versus peace Given the equilibrium values of θe l and θl O, we can derive the following utilities in case of war: ( u l (γɛ) 2 ) χr E,w = (1 δ) κy + ((1 m)κ(1 γ)(1 ɛ) + γɛ) 2, (20) and ( u l O,w = (1 δ) y + ((1 m)κ(1 γ)(1 ) ɛ))2 χr ((1 m)κ(1 γ)(1 ɛ) + γɛ) 2. (21) If the two groups agree on a peaceful sharing rule s, their respective utilities write as: u l E,p = κy + sχr Z, (22) and u l O,p = y + (1 s)χr Z. (23) Finally, comparing utilities at war and at peace allows us to compute the two thresholds: s l E = (1 δ)(γɛ) 2 ((1 m)κ(1 γ)(1 ɛ) + γɛ) 2 + Z δκy χr, (24) 19

20 and ( (1 δ)((1 m)κ(1 γ)(1 ɛ)) s l 2 o = 1 ((1 m)κ(1 γ)(1 ɛ) + γɛ) 2 + Z δy ). (25) χr such that group E prefers peace when the negotiated s exceeds s l E, while group O prefers peace when the negotiated s is lower than s l O. We can then claim the following. Proposition 4 With local social planners, a pacific settlement is viable only if s l E < sl O. The result of the above Proposition clearly parallels that of Proposition 2, the effects of the different parameters but m on s l E and sl O being qualitatively the same as those presented in Lemma 2. The role of the diaspora in shaping this result is, however, substantially different as compared to the benchmark model. In fact, with a local social planner, both thresholds s l E and sl O depend on m, while in the case of a global social planner migration has no effect on s E. More precisely, a larger diaspora makes group E more prone to war and group O more willing to negotiate, because it reduces the pool of potential soldiers of group O, thus implying, ceteris paribus, higher chances to prevail in an open conflict for group E. 8 Hence, it is not possible to establish a priori whether the diaspora has a peace-building or a peace-wrecking effect. The net impact of m on the likelihood of war depends on the parameters of the model, i.e. on specific country s characteristics, unlike the benchmark model where the diaspora has a non-ambiguous peace-wrecking effect. Note also that, different from the global social planner case, it is group E instead of group O which would push towards war here. In fact, while migrants from group O are the driving force of war in the benchmark model (since they enjoy the returns, but pay a lesser cost for conflict), in the local planner case migration confers a size advantage, and thus a stronger incentive to initiate a violent conflict, to group E. The case of a local social planner yields more complex results regarding the interactions between migration and the likelihood of war. Depending on the country s initial characteristics (i.e. on the values of the model s parameters), a larger diaspora can trigger a switch from peace to war (as 8 In case of migration from both groups, it is then reasonable to expect that the net impact of migration on conflict will depend on the relative sizes of the two groups diasporas. 20

21 in the case of the global social planner), but it can also push for peace. The setting being more complex, it is not possible to derive the analytical solution ˆm l of the equalization of s l E and sl O. Figure 4 depicts s l O and sl E as functions m, in the case where migration has a peace-wrecking effect. The intersection between the two curves then corresponds to the maximum size of the diaspora such that peace is possible. On the right hand side of ˆm l, the two groups enter in conflict. Note that, under different assumptions over the model parameters, s l E can be larger than sl O for low values of m, and smaller afterwards. Peace is then only possible on the right hand side of the intersection between the two curves, and diaspora clearly has a peace-building effect. This is the configuration depicted by Figure 5. 9 Figure 4: Peace-wrecking migration with local social planner. Figure 5: Peace-building migration with local social planner. s s l E s s l O s l O s l E 0 ˆm l m 0 ˆm l m To identify the conditions under which migration is peace-wrecking or peace-building, we can study the size of the impact of m on s l E and sl O. We know that m has a positive effect on both thresholds. Since peace requires s l O to be equal to or larger than sl E, the diaspora can only have a peace-building (respectively, peace-wrecking) effect if its impact on s l O is larger (respectively, smaller) than its impact on s l E. The partial derivatives of sl E and sl O with respect to m can be 9 It could also be the case that s l O starts from a higher (respectively, lower) level than s l E, implying the existence of a first peace (respectively, war) region for a small diaspora, then turns lower (respectively, higher) than s l E, making peace impossible (respectively, viable) for intermediary values of m, and eventually exceeds (respectively, falls below) s l E again, implying the existence of a second peace (respectively, war) region for a large diaspora. 21

22 written: and s l E m = (1 δ)2κ(1 γ)(1 ɛ)(γɛ)2 ((1 m)κ(1 γ)(1 ɛ) + γɛ) 3, (26) s l O m = (1 δ)(1 m)2(κ(1 γ)(1 ɛ))2 γɛ ((1 m)κ(1 γ)(1 ɛ) + γɛ) 3. (27) The diaspora has a peace-wrecking effect if its impact on s l O is smaller than its impact on sl E, hence if: s l E m > sl O m γɛ > (1 m)κ(1 γ)(1 ɛ). (28) From this, we deduce that the diaspora has a positive impact on the likelihood of war when γ > γ l, i.e. in countries where the efficiency of group E in the conflict is relatively important. This condition is also more likely to be respected for high values of ɛ, i.e. in countries where the elite is big, and for low values of κ. These results are consistent with the previous finding that the potential switch from peace to war induced by migration is triggered, in the local social planner case, by group E. If group E is bigger or more efficient in the conflict, its incentive to fight is larger because its probability to win is higher. On the contrary, if κ increases and group E thus enjoys a higher level of relative income, its relative opportunity cost for fighting rises and so does its willingness to negotiate peace. Finally, notice that the impact of the size of the diaspora on the negotiated s in case of peace is different in the local planner case, as compared to the benchmark model. Migration here leaves group O with a reduced bargaining power, since the minimum s that can be reached peacefully (namely, s l E ) increases with the level of m. The diaspora thus makes the group from which its emanates likely to tolerate higher values of s. Compared to the results of the global social planner case, this last point suggests that, in case of peaceful negotiation, migration benefits to the group from which its emanates when the diaspora has more stakes in the process of sharing of the contested resource (which is here reflected by the introduction or not of migrants utility in the objective function of group O). Intermediary cases between the global and local social planner models presented here would account for migrants in group O s objective function, as in the benchmark model, but attribute a smaller weight to their 22

23 utility as compared to that of residents. To summarize, this alternative specification underlines the size effects of migration on the two groups, and leads to an ambiguous effect of the diaspora on conflict. More precisely, it makes the group to which migrants belong more prone to negotiate peace, and the opposite group more willing to go to war, the net impact on the probability of conflict depending on country characteristics. As compared to the benchmark model, here the members of the diaspora are more independent with respect to their group, and eventually push their non-migrants fellows toward peace. This specification can thus be thought of as close from the post-9/11 Tamil case or from the Eritrean case. Appendix 7.2 presents an extension of this benchmark specification, introducing consumptiontargeted remittances. Its results are in line with the symmetric extension of the benchmark model presented in Appendix 7.1, private remittances having a non-ambiguous peace-building effect. 4 Active diaspora Sections 2 and 3 provide evidence that the diaspora affects differently the peace/war tradeoffs of the two groups, as well as the adopted sharing rule in case of negotiated peace, depending on the degree to which the leader of group O accounts for migrants utility. When migrants and residents are given the same weight in group O s utility function (Section 2), the diaspora has a non-ambiguous peace-wrecking effect, and it tends to enhance group O s bargaining power in case of peace. When the leader of group O does not include migrants in its objective function (Section 3), the diaspora has an ambiguous impact on the likelihood of war, while it tends to weaken group O s negotiation power in case of peaceful settlement. The diaspora thus appears to affect differently conflict outcomes depending on the degree of migrants inclusion in the decision process. More precisely, the two versions of the model suggest that diasporas are all the more peace-wrecking as they are involved in the war-related collective decisions taken in their homeland by the group they belong to. In the local planner configuration, the impact of the diaspora only channels through size effects, which make group O more willing to negotiate peace and group E more prone to war. In reality 23

24 however, migrants are not always passive. On the contrary, they may be actively involved, and mobilize various tools to play a strategic role in the conflict. The available anecdotal evidence notably puts forward the role of expatriated communities in shaping, through lobbying in particular, the balance of power between the two groups involved in the conflict in the homeland. In this section, we extend the local social planner model and introduce the optimization problem of the diaspora to account for its strategic role. We assume that migrants decide collectively on an amount of money B that is dedicated to finance, e.g., lobbying activities from abroad. All else equal, lobbying makes the sharing of the contested resource relatively more favorable to group O in case of war. This assumption suggests that, although migrants do not directly bring inputs to the conflict (they cannot become soldiers themselves 10 ), they can dedicate money to shape the outcome of the conflict, s(a E, A O ). More precisely, we assume that the amount B spent by the diaspora translates into a share of the contested resource for group O multiplied by B α. The (positive) parameter α here represents the efficiency of migrants lobbying from abroad. In this setting, the leaders of groups E and O must still decide on the share of their labor force that they allocate to conflict, while the leader of the diaspora (group M) must decide on the amount B to be dedicated to lobbying. Using the superscript d to denote the case of an active diaspora (in the local social planner case), utilities of the three groups at play can be written as: u d E = (1 δ)((1 θ d E)κy + χ(1 B α (1 s(a d E, A d O)))R), (29) u d O = (1 δ)((1 θ d O)y + χb α (1 s(a d E, A d O))R), (30) and u d M = (1 + µ)y B m(1 ɛ) + (1 δ)χbα (1 s(a d E, A d O))R. (31) The first order conditions u d E / θd E = 0, ud O / θd O = 0, and ud M / B = 0 yield the following 10 Migrants could however subsidize a certain number of soldiers in the homeland. This alternative way of modeling diaspora s activism yields similar results to those obtained here and is briefly presented at the end of this section, in footnote

25 reaction functions: B α (1 m)(1 γ)(1 ɛ)γ 3 ɛ 3 κyθ θe d O d = χr (1 m)(1 γ)(1 ɛ)κyγɛθd O (γɛ) 2, (32) κy θ d O = B α (1 m) 3 (1 γ) 3 (1 ɛ) 3 γɛyθe d χr (1 m)(1 γ)(1 ɛ)yγɛθd E ((1 m)(1 γ)(1 ɛ)) 2, (33) y and ( αθ d ) B = O (1 δ)(1 m)(1 γ)(1 ɛ)χr 1 1 α. (34) θo d (1 m)(1 γ)(1 ɛ) + θd E γɛ The intersection between them allows characterizing the equilibrium, with ψ = (1 γ)(1 ɛ): θ d E = θ d O = (1 m)ψγɛχr y((1 m)ψκ + γɛ) 2 (1 m)ψγɛκχr y((1 m)ψκ + γɛ) 2 ( α(1 δ)(1 m)ψκχr (1 m)ψκ + γɛ ( α(1 δ)(1 m)ψκχr (1 m)ψκ + γɛ ( α(1 δ)(1 m)ψκχr B = (1 m)ψκ + γɛ ) 1 1 α ) α 1 α ) α 1 α (35) (36) (37) Proposition 5 If we introduce active lobbying from the diaspora in the local planner model, both θ d E and θd O enough). are increasing functions of m if α > 1 (i.e. provided that lobbying abroad is efficient Proof. Follows from the inspection of the partial derivatives of the expressions of θ d E by Equations (35) and (36). and θd O given The equilibrium values of θ d E, θd O and B allow us to compute the utilities of groups E and O in case of war. In case of peace, utilities of groups E and O (u d E,p and ud O,p ) are exactly the same as in the local social planner model presented in Section 3 (i.e., respectively equal to u l E,p and ul O,p as given by Equations (22) and (23)). Finally, solving u d E,p = ud E,w and ud O,p = ud O,w yields the thresholds sd E, below which group E refuses a peaceful settlement, and s d O, above which group O refuses a peaceful settlement: s d E = (1 δ) ( 1 (1 m)κψ(2γɛ + (1 m)κψ) ((1 m)κψ + γɛ) 2 ( ) α ) α(1 m)κψ(1 δ)χr 1 α + Z δκy (1 m)κψ + γɛ χr, (38) 25