Economic Opportunities

The lack or breakdown of security guarantees offered by the institutions of the sovereign state favor both conflicts over access to resources and targeted looting strategies. Basically, material structures of opportunity refer to all available resources that can be extracted and thus used to guarantee one’s own capability to exert force. Areas of strategic insecurity are therefore most likely to arise in resource-rich areas: the greater the wealth of resources, the higher the probability that new entrepreneurs of violence will appear on the security market and compete with one another. Consequently, the incentive structure to continuously apply military force and to produce insecurity will be greater. The insight that the type of resource itself affects the risks of the occurrence and perpetuation of organized violence is even more fundamental. Empirical studies reveal that the effect of diamonds and oil is highly significant, while agricultural goods, by contrast, are hardly significant at all (Fearon 2005; Lujala, Gleditsch, and Gilmore 2005; Ross 2004). The extraction practice of guaranteeing one’s own freedom of action by mining mineral resources leads to a different logic of security and different constraints than does the looting of the civilian population. While the extraction of natural resources primarily poses logistical challenges, such as the securing of extraction and storage sites and transportation routes, the taxation of humanitarian aid and the looting of the civilian population by predatory gangs, rebel groups, or regular soldiers tends to be carried out in a more ad hoc and often uncoordinated manner. To put it in more general terms, the forms of the financing of violence can vary in time and space, even within single conflict zones, and in each case generate specific strategies of violence and insecurity.

Resources not only create the risk of the emergence of violent conflicts and provide opportunities for enrichment, they are also a critical quantum both for the survival of the civilian population and of various types of armed organizations. While the civilian population in resource-rich zones is subjected to the specific risks of indiscriminate violence (Weinstein 2006), the recruitment of new fighters is more difficult in resource-poor regions if they cannot be economically compensated. However, a substitute strategy is available for the leadership of armed groups under certain conditions: if rebel groups, warlords, or local militias are unable to distribute profits or maintain material motivation, they can rely on social relationships and provide credible promises of future payments (Weinstein 2005, 599).

Particularly specialized entrepreneurs of violence make profits by looting and protection services, thus jacking up the “protection screw” (Mehlum, Moene, and Torvik 2002). Looting has a dual function here: first, it enables better mobilization of resources to permit the financing of combat; second, it permits expenditures for the pay for combatants to be reduced (Azam 2006). In the long run however, the looting of the civilian population also raises two problems: on the one hand, the number of competitive armed groups can rise over time, and hence, too, the number of violent incidents; on the other, this situation permits no phases of regeneration for the population, during which they might produce new resources to loot. Both problems imply a marginal utility of looting over time.

These issues are closely related to organizational dynamics—that is, to the degree of organization of the armed organization. If military capacities expand, the expenditures for the maintenance of a military organization—payment for the combatants and maintenance of military equipment—increase at the same time. In other words, an increased degree of organization implies higher maintenance expenses and hence an increased demand for resources. The marginal utility of looting can therefore occur in a dual manner: first, via overlooting, by which noncoordinated looting and the potential increase of armed groups in effect result in overplundering and the loss of potential profits; and second, the profit no longer covers the regular expenditures of maintenance. According to economic theory, the positive beneficial effects for the civilian population increase with a minimum of security, since it can invest in production instead of protection services. A well-established armed organization can therefore certainly seize a dominant position in the course of the conflict and then take the opportunity of sharing in the profits of increasing productivity by taxation of protection in a defined territory—and thus institutionalize the initial rudiments of an order of violence.

In areas with only weakly organized armed organizations by contrast, the civilian population can theoretically be considered as a freely accessible resource, and is thus constantly endangered by overlooting (see Kurrild- Klitgaard and Svendsen 2003, 257).14 In situations of competition between armed groups, these conditions in fact intensify. Under conditions of incomplete information armed groups most likely come to no mutual agreement as to where and to what degree looting is to be undertaken, so that the probability of overlooting increases. Altogether, it is to be assumed that areas of limited statehood are often exposed to the risk of overlooting. A sustainable practice of extraction that allows for regeneration phases for the population can theoretically hardly be expected in situations in which armed groups are highly fractured into splinter factions and in which there is a high demand for resources and specific organizational structures.

 
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