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UNU-WIDER The Cost of Failing States and the Limits to Sovereignty

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A teenager wears torn rubber boots in a muddy local market in Bac Ha, Viet Nam. As of 2005 figures, half the world population—more than 3 billion people–is estimated to live on less than USD 2.50 a day. Bac Ha, Viet Nam. UN Photo/Kibae Park.

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The Cost of Failing States and the Limits to Sovereignty

In this paper, we estimate the costs of state failure, both for the failing state itself and for its neighbours. In our analysis, the cost of failure arises from two distinct sources: organized violence due to the incapacity of the state to ensure its own citizens' security and low quality of regulation and public goods due to poor governance. To estimate the cost of failure, we proceed in two steps. First we estimate the annual loss of growth induced by state failure. Then we cumulate this loss over time, taking into account the chances that each year a failing state will exit this status. Our growth estimations suggest that a failing state at peace loses 2.6 percentage points of growth per year, while violence induces a further loss of 1.6 percentage points of growth per year. ...
Publisher:
UNU-WIDER
Series:
WIDER Research Paper
Volume:
2007/30
Title:
The Cost of Failing States and the Limits to Sovereignty
Authors:
Lisa Chauvet, Paul Collier, and Anke Hoeffler
Publication date:
May 2007
ISSN Web:
1810-2611
ISBN Web:
9291909734
ISBN 13 Web:
9789291909735
Copyright holder:
© UNU-WIDER
Copyright year:
2007
Keywords:
responsibility, conflict, poverty
JEL:
C33, H56, H77, O4
Project:
Fragility and Development
Sponsor:
UNU-WIDER gratefully acknowledges the financial contributions to the project by The Australian Agency for International Development (AusAID), the Finnish Ministry for Foreign Affairs, and the UK Department for International Development-DFID.
Format:
online

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