We construct a dynamic theory of civil conflict hinging on inter-ethnic trust and trade. The model economy is … inhabitated by two ethnic groups. Inter-ethnic trade requires imperfectly observed bilateral investments and one group has to form … beliefs on the average propensity to trade of the other group. Since confict disrupts trade, the onset of a conflict signals …

We work with a panel of bilateral trade flows from 1988 to 2002, exploring the influence of infrastructure …, institutional quality, colonial and geographic context, and trade preferences on the pattern of bilateral trade. We are interested … in threshold effects, and so emphasize those cases where bilateral country pairs do not actually trade. We depart from …

the causal connection between lack of exposure to commercial trade and proclivity to sudden stops. On the theoretical … front, the paper shows how exposure to trade raises the creditworthiness of countries and reduces the probability of sudden … trade increases the likelihood of default. A sudden stop takes place when the borrowers reject the amount that lenders want …

Openness to trade is one factor that has been identified as determining whether a country is prone to sudden stops in … problem that trade is endogenous. Using the gravity instrument for trade openness, which is constructed from geographical … determinants of bilateral trade, this paper finds that openness indeed makes countries less vulnerable, both to severe sudden stops …

the causal connection between lack of exposure to commercial trade and proclivity to sudden stops. On the theoretical … front, I show how exposure to trade raises the creditworthiness of countries and reduces the probability of sudden stops. In … debt is more attractive. Therefore, conditional on the amount that lenders are willing to loan, decreased exposure to trade …

adherence is systematically higher along the pre-Islamic trade routes. We discuss the possible mechanisms that may give rise to … and proximity to lucrative trade routes. We argue that these elements exacerbated inequalities across diverse tribal … societies producing a conflictual environment that had the potential to disrupt trade flows. Any credible movement attempting to …

risks to free trade and our prosperity. …