Social Insurance and Conflict: Evidence from India

Featuring

Thiemo Fetzer
London School of Economics

Host
Michael Clemens
Center for Global Development

Can public interventions persistently reduce conflict? In his paper, Fetzer studies whether social insurance is effective in reducing conflict. Adverse income shocks have been empirically and theoretically identified as robust drivers of conflict. An effective social insurance system moderates the impact of adverse shocks on household incomes, and hence, could attenuate the link between these shocks and conflict.

Fetzer’s paper examines a public employment program in India that provides social insurance. The program guarantees 100 days of employment at minimum wages providing an alternative source of income following bad harvests, which has an indirect pacifying effect. The findings suggest that by moderating the link between productivity shocks and incomes, the program uncouples productivity shocks and conflict.