This paper addresses the false dichotomy of 'greed-grievance' regarding the onset of civil wars, providing a theory that specifies the interaction of economic and identity-based factors within a two-stage causal process. The sociological concept of overlapping versus cross-cutting social cleavages is applied to explain the origins of the potential for ethnic civil war, as the overlap of ethnic cleavages with material cleavages fuels an in-group/out-group ideology. Such situations can, however, exist for decades without the onset of war, thus it is necessary to delineate this question from the necessarily separate, temporal question of the timing of the outbreak of such wars as a second stage. Catalysts such as economic decline and adverse regime change provide the variables that, in the presence of a social structure of overlapping social cleavages, exacerbate existing intergroup tensions to the point of organized violence, or are mitigated by the lack of major cleavages or the presence of cross-cutting cleavages. Evidence from cases is provided, followed by a discussion of the implications of this theory for further research.