Crop prices and deforestation in the tropicsJournal articleNicolas Berman, Mathieu Couttenier, Antoine Leblois and Raphaël Soubeyran, Journal of Environmental Economics and Management, Volume 119, pp. 102819, 2023

Understanding the mechanisms of deforestation is necessary in order to slow or arrest its progress. To accomplish this requires rigorously estimating the demand for deforestation. We contribute to this endeavor by estimating the effect of crop prices on the demand for conversion of land from forest to agriculture in the tropics during the 21st century. The two main difficulties involved are the lack of harmonized data on local crop prices in the tropics and the fact that they are determined simultaneously with decisions to deforest. We propose a strategy to circumvent these two issues using high-resolution annual forest loss data for the tropics, combined with information on crop-specific agricultural suitability and annual international crop prices. We find that crop price variation has a significant impact on deforestation: increases in crop prices are estimated to be responsible for one-third of total deforestation in the tropics (totaling about 2 million km2) during the period 2001–2018. We also find that the degree of openness to international trade and the level of economic development are first-order local characteristics affecting the magnitude of the impact of crop prices on deforestation.

Mineral Resources and the Salience of Ethnic IdentitiesJournal articleNicolas Berman, Mathieu Couttenier and Victoire Girard, The Economic Journal, Volume 133, Issue 653, pp. 1705-1737, 2023

This paper shows how ethnic identities may become more salient due to natural resources extraction. We combine individual data on the strength of ethnic—relative to national—identities with geo-localised information on the contours of ethnic homelands, and on the timing and location of mineral resources exploitation in 25 African countries, from 2005 to 2015. Our strategy takes advantage of several dimensions of exposure to resources exploitation: time, spatial proximity and ethnic proximity. We find that the strength of an ethnic group identity increases when mineral resource exploitation in that group’s historical homeland intensifies. We argue that this result is at least partly rooted in feelings of relative deprivation associated with the exploitation of the resources. We show that such exploitation has limited positive economic spillovers, especially for members of the indigenous ethnic group; and that the link between mineral resources and the salience of ethnic identities is reinforced among members of powerless ethnic groups and groups with strong baseline identity feelings or living in poorer areas, or areas with a history of conflict. Put together, these findings suggest a new dimension of the natural resource curse: the fragmentation of identities, between ethnic groups and nations.

Shutdown policies and conflict worldwideJournal articleNicolas Berman, Mathieu Couttenier, Nathalie Monnet and Rohit Ticku, Journal of Comparative Economics, Volume 50, Issue 1, pp. 240-255, 2022

We provide evidence on the link between the policy response to the SARS CoV-2 pandemic and conflicts worldwide. We combine daily information on conflict events and government policy responses to limit the spread of SARS CoV-2 to study how demonstrations and violent events vary following shutdown policies. We use the staggered implementation of restriction policies across countries to identify the dynamic effects in an event study framework. Our results show that imposing a nation-wide shutdown is associated with a reduction in the number of demonstrations, which suggests that public demonstrations are hampered by the rising cost of participation. However, the reduction is short-lived, as the number of demonstrations are back to their pre-restriction levels in two months. In contrast, we observe that the purported increase in mobilization or coordination costs, following the imposition of restrictions, is not followed by a drop of violent events that involve organized armed groups. Instead, we find that the number of events, on average, increases slightly following the implementation of the restriction policies. The rise in violent events is most prominent in poorer countries, with higher levels of polarization, and in authoritarian countries. We discuss the potential channels underlying this heterogeneity.

Fertile Ground for ConflictJournal articleNicolas Berman, Mathieu Couttenier and Raphaël Soubeyran, Journal of the European Economic Association, Volume 19, Issue 1, pp. 82–127, 2021

We investigate how variations in soil productivity affect civil conflicts. We first present a model with heterogeneous land in which variations in input prices (fertilizers) affect appropriable rents and the opportunity costs of fighting. The theory predicts that spikes in input prices increase the likelihood of conicts through their effect on income and inequality, and that this effect is magni fied when soil fertility is naturally more heterogenous. We test these predictions using data on conict events covering all Sub-Saharan African countries at a spatial resolution of 0.5 x 0.5 degree latitude and longitude over the 1997-2013 period. We combine information on soil characteristics and worldwide variations in fertilizer prices to identify local exogenous changes in input costs. As predicted, variations in soil productivity triggered by variations in fertilizer prices are positively associated with conicts, especially in cells where land endowments are more heterogeneous. In addition, we find that the distribution of land fertility both within and across ethnic groups affects violence, and that the effect of between-group heterogeneity in soil quality is magnified in densely populated areas. Overall, our findings imply that inequality in access to fertile areas { an issue largely neglected in the literature dealing with the roots of Sub-Saharan African civil wars { constitutes a serious threat to peace at the local-level.

Shutdown policies and worldwide conflictJournal articleNicolas Berman, Mathieu Couttenier, Nathalie Monnet and Rohit Ticku, Covid Economics, Volume 16, pp. 61-75, 2020

We provide real-time evidence on the impact of Covid-19 restrictions policies on conflicts globally. We combine daily information on conflict events and government policy responses to limit the spread of coronavirus to study how conflict levels vary following shutdown and lockdown policies. We use the staggered implementation of restriction policies across countries to identify their effect on conflict incidence and intensity. Our results show that imposing a nationwide shutdown reduces the likelihood of daily conflict by around 9 percentage points. The reduction is driven by a drop in the incidence of battles, protests and violence against civilians. Across actors the decline is significant for conflicts involving political militias, protesters and civilians. We also observe a significant cross-country heterogeneity in the effect of restriction policies on conflict: no conflict reduction is observed in low income countries and in societies more fractionalized along ethnic or religious lines. We discuss the potential channels that can explain this heterogeneity.

Conflict in times of COVID-19Book chapterNicolas Berman, Mathieu Couttenier, Nathalie Monnet and Rohit Ticku, In: COVID-19 in Developing Economie, Simeon Djankov and Ugo Panizza (Eds.), 2020-06, pp. 147-156, CEPR Press, 2020

This chapter discusses the potential impacts of the spread of COVID-19, and the restriction policies that it has triggered in many countries, on conflict incidence worldwide. Based on anecdotal evidence and recent research, we argue that imposing nation-wide shutdown policies diminishes conflict incidence on average, but that this conflict reduction may be short-lived and highly heterogeneous across countries. In particular, conflict does not appear to decline in poor, fractionalised countries. Evidence points to two potential ways in which COVID-related restriction policies may increase conflict: losses in income and magnified ethnic and religious tensions leading to scapegoating of minorities.

Demand Learning and Firm Dynamics: Evidence from ExportersJournal articleNicolas Berman, Vincent Rebeyrol and Vincent Vicard, The Review of Economics and Statistics, Volume 101, Issue 1, pp. 91-106, 2019

This paper provides direct evidence that learning about demand is an important driver of firms’ dynamics. We present a model of Bayesian learning in which firms are uncertain about idiosyncratic demand in each market and update their beliefs as noisy information arrives. Firms update their beliefs to a given demand shock more, the younger they are. We test and empirically confirm this prediction, using the structure of the model, together with exporter-level data, to identify demand shocks and the firms’ beliefs about future demand. Consistent with theory, we also find the learning process to be weakened in more uncertain environments.

Financial constraints, institutions, and foreign ownershipJournal articleRon Alquist, Nicolas Berman, Rahul Mukherjee and Linda L. Tesar, Journal of International Economics, Volume 118, pp. 63-83, 2019

We develop a model of cross-border acquisitions in which the foreign acquirer's ownership choice reflects a trade-off between easing the target's credit constraints and the costs of operating in an environment with weak institutions. Data on domestic and foreign acquisitions in emerging markets over the period 1990–2007 support the model predictions. The share of full foreign acquisitions is higher in sectors more reliant on external finance, in countries with lower financial development, and in countries with higher institutional quality. Sectoral external finance dependence accentuates the effect of country-level financial development and institutional quality. By contrast, the level of foreign ownership in partial acquisitions is insensitive to institutional factors and depends weakly on financial factors.

Trade Policy and Market Power: Firm-Level EvidenceJournal articleAlan Asprilla, Nicolas Berman, Olivier Cadot and Mélise Jaud, International Economic Review, Volume 60, Issue 4, pp. 1647-1673, 2019

This article identifies the effect of trade policy on market power through new data and a new identification strategy. We identify market power by observing how exporting firms price discriminate across markets following variations in bilateral exchange rates. Pricing-to-market is prevalent in all countries in our sample, even among small firms, although it is increasing in firm size. More importantly, we find that the effect of nontariff measures (NTMs) is not isomorphic to that of tariffs. Whereas tariffs reduce the market power of foreign firms through rent-shifting effects, NTMs reinforce the market power of nonexiting firms, domestic and foreign alike.

This Mine Is Mine! How Minerals Fuel Conflicts in AfricaJournal articleNicolas Berman, Mathieu Couttenier, Dominic Rohner and Mathias Thoenig, American Economic Review, Volume 107, Issue 6, pp. 1564-1610, 2017

We combine georeferenced data on mining extraction of 14 minerals with information on conflict events at spatial resolution of 0.5 degree x 0.5 degree for all of Africa between 1997 and 2010. Exploiting exogenous variations in world prices, we find a positive impact of mining on conflict at the local level. Quantitatively, our estimates suggest that the historical rise in mineral prices (commodity super-cycle) might explain up to one-fourth of the average level of violence across African countries over the period. We then document how a fighting group's control of a mining area contributes to escalation from local to global violence. Finally, we analyze the impact of corporate practices and transparency initiatives in the mining industry.