The Impact of Conflict on State Capacity in Nigeria
Date
2022-01
Authors
Babajide, Adedoyin
Ajayi, Victor
Journal Title
Journal ISSN
Volume Title
Publisher
African Economic Research Consortium
Abstract
Nigeria has witnessed incessant incidents of conflict-related violence in recent years.
This paper seeks to investigate how conflicts affect state capacity in term of growth
in GDP per capita and tax per GDP ratio, and to examine the potential spill over effect
of conflict in neighbouring state. The System Generalised Method of Moments (GMM)
technique is employed for a panel data of 37 states in Nigeria over the period 2000
to 2013. Our main results show that increase in incident of conflict reduces state
capacity, with more negative effect on growth than tax. We also find evidence that
states suffer weaker growth and loss of tax revenue because of conflict in adjacent
states due to spill over effect of conflict. The difference-in-differences method is
used to unravel the net effect of conflict in the Boko Haram afflicted states relative
to other states. The findings suggest that individuals living in states heavily affected
by Boko Haram experienced a negative change in state capacity, especially in their
perception of government provision of health and education, relative to unaffected
states between 2008 and 2012.
Description
Keywords
Conflict, state capacity, spill over, dynamic panel model, Nigeria