This paper builds a dynamic theory of secessions, conflictual or peaceful, analyzing the forward looking interaction between groups in a country. The proposed framework allows us to jointly address several key stylized facts on secession, and generates several novel predictions. We find that if...

Conflict undermines development, while poverty, in turn, breeds conflict. Policy interventions such as cash transfers could lower engagement in conflict by raising poor households' welfare and productivity. However, cash transfers may also trigger appropriation or looting of cash or assets. The...