Re-examining Economic Shocks and Civil Conflict

Using annual rainfall variation as an instrumental variable for growth, we show that economic growth is negatively related to civil conflict in Africa. Antonio Ciccone (2011) argues that thanks to rainfall's mean-reverting nature, rainfall levels are preferable to annual changes. We make three points. First, our findings hold using rainfall levels as instruments. Second, Ciccone (2011) does not provide theoretical justification for preferring rainfall levels. Third, the first-stage relationship between rainfall and growth is weaker after 2000, suggesting that alternative instruments are needed when studying recent conflicts. We highlight the accumulating microeconomic evidence that adverse economic shocks lead to political violence.