The risk of civil conflicts as a determinant of political institutions

This paper proposes a mechanism to explain differences in political institutions based on a particular feature of civil conflicts that has not been previously explored. Under asymmetric and uncertain costs of civil conflicts members of the elite would like to commit in advance to a strong response to insurgencies, but ex-post they have the incentives to block any response if the conflict mainly affects other members of the elite. One way of solving this commitment problem is empowering the executive so he may react forcefully to conflicts, despite the opposition of some fraction of the elite. The main prediction is that, conditional on asymmetric and uncertain costs, the higher is the likelihood of a conflict in the future, the lower are the constraints imposed on the executive. The paper validates this implication using a sample of former colonies and geographic variables to identify the exogenous component of the likelihood of conflicts. (C) 2016 Elsevier B.V. All rights reserved.