The regularity with which peace deals break down and civil wars resume is well established. This briefing looks at the factors that drive violent conflicts, and the factors that may undermine peace deals, including those brokered and supported by international third parties. For peace to last, agreements must be viable, credible and enforceable, and the commitment of donors must not be in doubt. For these conditions to be in place, conflict resolution must be in donors' interests.Civil war, Social Contract, Aid for Peace

Mansoob Murshed

English

Research Papers in Economics

Social Contracts, Civil 
Conﬂicts and International 
Peacemaking
  MICROCON Policy Brieﬁng 4    September 2008                 Mansoob Murshed
Summary: The regularity with which peace deals break down 
and civil wars resume is well established. This brieﬁng looks at 
the factors that drive violent conﬂicts, and the factors that may 
undermine peace deals, including those brokered and supported 
by international third parties. For peace to last, agreements must 
be viable, credible and enforceable, and the commitment of do-
nors must not be in doubt. For these conditions to be in place, 
conﬂict resolution must be in donorsʼ interests.
•Why are peace agreements 
often so shortlived? 
•What determines the ef-
fectiveness of international 
peacemaking assistance?
1. Introduction
Much of the recent economics lit-
erature on conﬂict has looked at the 
microeconomic  underpinnings  of 
the origins and resolution of con-
ﬂicts. It has begun to get beyond the 
dichotomy  of  ʻgreedʼ  and  ʻgriev-
anceʼ as alternative causes of con-
ﬂict, and now tends to look at how 
the two factors co-exist, and at the 
relation between them. 
At  the  centre  of  many  theoretical 
approaches is the idea of the break-
down  of  an  agreement  between 
groups, which we call a ʻsocial con-
tractʼ. This  refers  to  a  framework 
that  governs  the  allocation  of  re-
sources, including natural resource 
income and the peaceful settlement 
of  grievances.  If  viable,  credible 
and enforceable, this social contract 
can restrain opportunistic behaviour 
such as large-scale theft of resource 
rents and the violent expression of 
grievance.
Such contracts can be horizontal or 
vertical; they must be self enforc-
ing  with  no  incentives  to  deviate 
from them; and they must be held 
together by a well-functioning gov-
ernment and peaceful economic ex-
change.
A related concept, when looking at 
the effects of conﬂict, is that of state 
capacity  to  collect  taxes,  enforce 
contracts  and  promote  legal  mar-
kets. The idea that the level of state 
capacity  determines  the  incidence 
of conﬂict has recently been chal-
lenged. Some argue that the pros-
pects of different types of conﬂict, 
internal and external, have different 
impacts  on  government  incentives 
to invest in state capacity. For ex-
ample,  in  resource  rich  countries 
prospects  of  future  conﬂict  may 
result in increasing resource extrac-
tion. This may be used to ﬁnance the 
military, increase the eliteʼs gains or 
diversify the economy and deliver 
POLICY BRIEFING 4 SEPTEMBER 2008
 POLICY BRIEFING
Pakistani peacekeepers in Mogadishu, Soma-
lia © ctsnowPOLICY BRIEFING 4 SEPTEMBER 2008
US soldiers on Operation Restore Hope in 
Somalia, 1992 © John Martinez Pavliga
public  goods  to  buy  peace.  The 
preferred outcome will depend on 
the  survival  function  of  those  in 
power and rebelsʼ opportunity and 
incentives  to  appropriate  gains 
(Brunnschweiler and Bulte 2007).
The four main channels of 
conﬂict generation
The  literature  outlines  four  main 
channels of conﬂict generation:
(i)  Breakdown  of  revenue  agree-
ments between those in power and 
various  stakeholders,  which  can 
produce greed and grievance. Greed 
and grievance can also lead to the 
breakdown of the social contract.
(ii)  Growth  failure,  and/or  fail-
ure  to  redistribute  in  a  perceived 
ʻfairʼ manner gains from economic 
rebels. This often led to the accu-
mulation  of  grievances  within  the 
context  of  a  disintegrating  social 
contract, and a state perceived to ex-
ercise favouritism in public spend-
ing and taxation. It also increased 
greed  based  motives  for  control-
ling natural resources far from the 
central  government  powerhouse. 
However, external players can also 
enhance peace through peace talks, 
aid, debt relief, economic sanctions, 
peacekeeping interventions and in-
ternationally sponsored courts pros-
ecuting  human  rights  violations. 
These measures will be effective as 
long as they are credible in making 
it costly for local factions to renege 
from  peace  deals.  The  shape  and 
cost of the peace enhancing ʻtech-
nologyʼ matter for the effectiveness 
of external interventions.
The break down of peace deals
Peace agreements amongst warring 
factions in contemporary develop-
ing-country civil wars are often not 
ʻself-enforcingʼ  –  they  are  can  be 
undermined by the lure of valuable 
resource rents and/or longstanding 
grievances. There  are  several  rea-
sons why they may break down:
Subsequent levels of conﬂict can often be higher than before 
failed peace agreements
economic  growth  in  resource  rich 
countries  or  middle-income  coun-
tries.
(iii) The individual incentives faced 
by rulers that may or may not cause 
them  to  promote  development, 
ʻmodernisationʼ and peace – espe-
cially in situations where the sepa-
ration of powers and the sources of 
power are inherently unstable 
(iv)  Interaction  of  these  domestic 
factors  with  external  events  and 
actors.  In the Cold War period the 
West  provided  ﬁnance  and  ideo-
logical succour to certain elites and 
(i)  Differences may be intracta-
ble, making peace impossible with-
out outright military victory, or an 
outside party changing the incentive 
structure of the conﬂict.
(ii)  One  party  may  have  such 
a  bad  reputation  that  they  cannot 
credibly  commit  to  peace  even  if 
they want to, and there may be no 
institutions  upon  which  to  anchor 
genuine commitments to peace. 
(iii)  Information may be imper-
fect:  the  presence  of  lootable  re-
source rents may make it difﬁcult to 
see through avaricious intent 
(iv)  Discounting for future costs 
of reneging: one side may renege 
in order to satisfy its current impa-
tience to consume.
Third party enforcement of peace 
deals
In  order  to  counter  these  factors, 
third  party  enforcement  of  peace 
deals is often required, for example 
through peacekeeping forces, arms 
controls,  trade  restrictions  (e.g. 
blood diamond embargoes) and for-
eign aid – ʻcommitment technolo-
giesʼ. Trade sanctions can be used 
by a foreign power to reduce greedy 
attitudes by governments or rebels. 
International controls on arms trans-
fers or ﬁnancing from non-residents 
can raise the cost of war. 
Third parties can also establish in-
ternational  agreements  that  work 
on  intrinsic  grievances,  provide  a 
ʻpeace  dividendʼ,  and  hold  out  a 
forceful sanction in the event of de-
viation from agreements. To be par-
ty to such an agreement implies a 
strategic pre-commitment to peace 
by delegation to a treaty or outside 
adjudicator.  However,  such  agree-
ments will only work if the commit-
ment of the third party is perceived 
to be genuine. If the level of force 
and development aid are considered 
inadequate and thus little more than 
ʻcheap  talkʼ,  they  will  be  a  com-
plete failure. The subsequent levels 
of conﬂict can often be higher than 
they  were  before  the  failed  peace 
agreement. 
We can ﬁnd an example of this in 
Rwanda. In 1993, after two-and-a-
half years of civil war, the Rwandan 
President,  Major-General  J.  Hab-
yarimana signed a peace agreement 
with  his  opponents,  the  Rwandan 
Patriotic Front (RPF) in the Tanza-
nian town of Arusha. He signed un-
der immense pressure from donors, POLICY BRIEFING 4 SEPTEMBER 2008
Supporting peace  deals in far away places costs donor coun-
tries more, and yields them fewer beneﬁts
the domestic opposition and the mil-
itary threat of the rebel force. West-
ern  donors  were  heavily  engaged 
in the entire peace process, includ-
ing military support and promises 
of ﬁnancial aid. With the economy 
in subsistence mode, coffee prices 
down and crop failure hurting the 
population,  the  regime  was  strug-
gling to survive. 
But one may ask: were the presi-
dent  and  rebel  army  (RPF)  genu-
inely committed to peace? The an-
swer must be no. In a speech before 
his supporters, the president called 
the agreement ʻjust a scrap of pa-
perʼ. A group of ofﬁcers and lead-
ing  administrators  from  the  presi-
dentʼs inner circle were organizing 
small-scale massacres of Tutsi far 
from the frontline in which a total 
of 2,000 people were killed (FIDH 
1993) and the presidential clan set 
up a hate radio station (Radio des 
Mille Collines) that vehemently at-
tacked the peace agreement and the 
Rwandan Patriotic Front (RPF). In 
reality, the ruling elite around Hab-
yarimana  was  used  to  ruling  the 
country on their own, and had no 
long-term interest in sharing power 
with the RPF. Even sharing power 
with the domestic Hutu opposition 
was  only  accomplished  after  in-
tense pressure from within and out-
side the country. The campaign of 
hate ultimately ended in genocide 
that cost the lives of at least 500,000 
Tutsi  people. The  Rwandan  Patri-
otic Front on their part repeatedly 
engaged in surprise attacks (Janu-
ary  1991,  February  1993)  which 
cast  doubts  on  their  commitment 
to peace as well. With a weak man-
date to enforce the peace, the small 
and under-equipped UN contingent 
tragically failed to prevent violence 
as soon as the peace agreement col-
of Congo, a state the size of West-
ern Europe. This means that peace 
deals in such places are unlikely to 
succeed. Underlying this reluctance 
to pay is the fact that peace, stabil-
ity and progress are global public 
goods whose costs are borne only 
by donorsʼ taxpayers. In a context 
of conﬂicting donorsʼ interests, it is 
unsurprising that provision is con-
centrated  there  where  global  ben-
eﬁts  are  more  easily  captured  by 
taxpayers.
The role of diasporas
Finally, it is important to consider 
the role of diaspora groups in pro-
viding  ﬁnance  to  armed  groups. 
Such diasporas often bear the same 
historical  grievances  as  domestic 
rebels, but they do not beneﬁt from 
the ʻpeace dividendsʼ provided by 
lapsed. 
The  external  sponsors  of  peace 
deals
The commitment technologies out-
lined above are the result of exter-
nal intervention, and as such they 
involve costs to outside parties. It 
therefore makes  sense  to  consider 
the  beneﬁts  of  commitment  tech-
nologies  to  outside  sponsors,  and 
why they would be likely to provide 
sufﬁcient  resources  to  secure  and 
effective peace deal or not. The idea 
here  is  that  the  sponsor  or  ﬁnan-
cier of peacekeeping derives some 
beneﬁt from peace in other parts of 
the world due to security considera-
tions (such as reduction in terrorism 
or  refugee  inﬂuxes),  humanitarian 
considerations or because promot-
ing  peace  enhances  the  sponsorʼs 
international prestige. 
When conﬂicts are far away from 
the  developed  world,  supporting 
successful peace deals tends to cost 
donor countries more, and to yield 
fewer  beneﬁts.  The  sanctions  and 
beneﬁts cost more to implement due 
to factors such as endemic poverty 
and lack of infrastructure. There is 
also less incentive to pay such costs, 
as the beneﬁts to Western taxpayers 
are less, compared to conﬂicts that 
are closer to home.
For instance, in the Balkans there 
are  well-resourced,  high-quality 
and  adequately  mandated  peace-
keepers. Up to 100,000 peacekeep-
ers were deployed to Kosovo at any 
one time. However, despite the talk 
of the need to end civil wars in Afri-
ca, weak and ineffectual forces tend 
to be deployed there – for instance 
there  are  only  16,000  troops  de-
ployed in the Democratic Republic 
An armoured personnel carrier of the UN 
peacekeeping force in Kosovo © M Eriks-
son
the government or outside donors. 
This  introduces  a  trade-off  in  the 
gains  associated  with  peace  and 
war for rebels, as they may have to 
choose between the diaspora fund-
ing and the proceeds of peace. Di-
asporas  may  ʻbuyʼ  war  through 
money,  arms  trafﬁcking  or  lobby-POLICY BRIEFING 4 SEPTEMBER 2008
lobbying for international support, 
which  may  explain  why  conﬂicts 
persist over time even when resourc-
es are mobilised to compensate for 
domestic rebelsʼ grievances.
Conclusion
If the cost of effective commitment 
technologies  is  too  high,  or  they 
yield  little  security  beneﬁt  to  the 
donor, as is likely to be the case for 
conﬂicts in distant lands, there is of-
ten under-resourcing of agreements. 
This makes it more likely that they 
are  really  little  more  than  ʻcheap 
talkʼ. Perhaps, that is why we do not 
see a speedy end to many civil wars 
in Africa. 
In  the  ultimate  analysis,  cred-
ible commitments to peace must be 
found  in  effective  domestic  solu-
tions that involve constitutional re-
straints and delegation of power. As 
argued by Rothchild (2005), mech-
anisms leading to the separation of 
powers, and where decisions on dif-
ferent issues are taken by diversely 
constituted  bodies,  may  prove  the 
most durable solution for sustaining 
the peace. Quick-ﬁx power sharing 
arrangements between warring par-
ties must be considered only as a 
solution for the short term. 
Credits
This Policy Brieﬁng was written by Man-
soob Murshed, Institute of Social Studies, 
The  Hague,  and  University  of  Birming-
ham, UK.
It is principally based on the ﬁndings of 
MICROCON  Research Working  Paper  8 
(see opposite).
The views expressed in this brieﬁng are the 
authorʼs alone.
Further reading
Brunnschweiler, C. & E. Bulte (2007) ʻNatural Resources and Violent 
Conﬂict: Resource Abundance, Dependence and the Onset of Civil Warsʼ 
Paper presented at the 2007 Oxcarre Launch Conference, Oxford. 
http://www.oxcarre.ox.ac.uk/wp-content/uploads/brunnschweiler-bulte.
pdf
Cuesta, J. and Murshed, M., (2008) ʻThe Micro-foundations of Social 
Contracts, Civil Conﬂicts and International Peace-Makingʼ. MICROCON 
Research Working Paper 8, Brighton: MICROCON. 
http://www.microconﬂict.eu/publications/RWP8_JC_MM.pdf 
Murshed,  S.  M.  &  P.  Verwimp  (2006)  ʻEnforcing  Peace  Agreements 
Through Commitment Technologiesʼ Research Paper no. 2008/45, UNU-
WIDER, Helsinki. 
http://www.wider.unu.edu/publications/working-papers/research-pa-
pers/2008/en_GB/rp2008-45/_ﬁles/79269766095176387/default/rp2008-
45.pdf 
Rothchild, D. (2005). ʻReassuring Weaker Parties after Civil Wars: The 
Beneﬁts and Costs of Executive Power-sharing Systems in Africaʼ. Ethno-
politics, 4 (3): 247-67.
MICROCON, or ʻA Micro Level Analysis of Violent Conﬂictʼ is a ﬁve-year research 
programme funded by the European Commission, which takes an innovative micro level, 
multidisciplinary approach to the study of the conﬂict cycle.
Almost one third of the worldʼs population lives in conﬂict-affected low-income coun-
tries. At a fundamental level, conﬂict originates from peopleʼs behaviour and how they 
interact with society and their environment - from its ʻmicroʼ foundations. Yet most con-
ﬂict research and policy focuses on ʻmacroʼ perspectives. MICROCON seeks to redress 
this balance.
For more information on MICROCON, please visit our website:
http://www.microconﬂict.eu
Or contact us at
MICROCON - A Micro Level Analysis of Violent Conﬂict
Institute of Development Studies
Brighton BN1 9RE, UK
Tel: +44 (0)1273 872 891
© Copyright Mansoob Murshed 2008
ISSN 1757-238X

Social Contracts, Civil Conflicts and International Peacemaking

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Social Contracts, Civil Conflicts and International Peacemaking

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