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We empirically analyze the link between state capacity and civil conflict via the manufacturing sector, which is the source of wealth for an emerging new elite interested in obtaining political representation, and is the outcome of a new political equilibrium more in tune with capital accumulation. This raises the cost of civil conflict, reducing its probability of occurrence. We find evidence in favor of our hypothesis in panels of African and Latin American countries.

The relationship between income inequality and polarization is an empirical fact: a change in equality might occur together with a change in polarization. At the same time, polarization might emerge while inequality remains constant. The outcome of this process entails relevant information on the evolution of the income distribution. We exploit the LIS database to perform a relative distribution analysis for six European countries. Our aim is describing how disposable income distributions evolved over time. The results indicate that polarization increased in all the considered countries, being the largest in the United Kingdom and the smallest in Italy. Nonetheless, in all the countries downgrading prevails over upgrading: the relevance of the middle class getting poorer is larger than the one of the middle class getting richer.

Raul Caruso, educated in Naples, Leuven and Milan, is currently senior researcher at the Institute of Economic Policy, Università Cattolica del Sacro Cuore (Italy) where he is also serving as adjunct professor of international economics. He is also visiting professor at Warsaw University (Poland). He has also been visiting professor at Massachusetts Institute of Technology (MIT) (USA), Hiroshima University (Japan), Kazakh Humanitarian Law University (Kazakhstan) and Novosibirsk State University (Russian Federation). His main research interests are peace economics, international political economy, economics of crime and sport economics. He has published on contest theory, sport economics, economic interpretation of terrorism, economic causes of wars and international economic sanctions. He is the executive coordinator of Network of European Peace Scientists (NEPS). He is also editor in chief of Peace Economics, Peace Science and Public Policy.

The study of war and peace is nowadays becoming a complex topic drawing from different disciplines and applying different methodologies. This book collects 10 studies on conflict and its pernicious consequences. The appropriate scientific field for this set of studies is the peace economics as defined in Isard (1994), Arrow (1995) and Caruso (2010). In particular, Peace Economics is a sub-field of Peace Science and it is generally concerned with (1) the economic determinants of actual and potential conflicts; (2) the impact of conflict on welfare and on the economic behaviour of societies; (3) the use of economic measures to cope with and control conflicts whether economic or not. Central to this field are analyses of conflicts amongst nations, regions and other communities of the world; measures to control (deescalate) arms races and achieve reduction in military expenditures; programmes and policies to utilize resources thus released for more constructive purposes. Put briefly, the main object of peace economics is the study of conflict and conflict resolution in different forms. In particular, the contents of this book are mainly on the positive ‘side’ of Peace Economics, which emphasizes the study of conflict and its consequences. In particular, in the recent years, a growing economic literature has uncovered both the economic determinants and consequences of actual intra-state conflicts. This book is intended to be a contribution to this literature. It gathers both theoretical and empirical contributions.

The Covid-19 pandemic has rekindled interest in sovereign debt crises amidst calls for debt relief for developing and emerging countries. But has debt relief lessened the debt burdens of emerging and developing economies? The purpose of this paper is to empirically address this question. In particular, the focus is on the implications of debt relief and institutional qualities for sovereign debt in emerging and developing economies.

The model extends the framework on the probability of default by incorporating the receipt of debt relief by a debtor country. Doing so allows to better explain movements of sovereign defaults relating to debt relief. The model is estimated via the regular probit regression.

The analysis shows that the debt relief provided, thus, far, failed to ease the debt overhang problems of developing and emerging countries and reduced investment. The current debt relief schemes may underscore the prospects of self-enforcing and self-fulfilling sovereign debt crises rather than eliminating the dilemma completely. Regarding the forms of debt relief, the analysis shows that debt forgiveness offers favourable prospects in terms of debt sustainability and economic outcomes than debt rescheduling. Perhaps, the sovereign debt crises, particularly in low-income countries, hinge on insolvency problems rather than transitory illiquidity issues.

Any debt relief mechanism should consider seriously the potential incentive effect that reinforces expectations of future debt-relief initiatives. Importantly, solving the sovereign debt problem requires a programme for sustained investment and economic growth, while not discounting the critical role of prudent debt management policies and institutions.

This study contributes a different angle to the debate on sovereign debt distress. Aside from the structural and economic factors, this study investigates the role of debt management policy in the debtor nation and the implications of debt relief benefits for sovereign risk. The framework also focuses on whether the different forms of debt relief exert distinctive impacts.

This paper aims to examine the distributional channel of monetary policy (MP) and evaluate how financial development (FD) affects the transmission mechanism from MP to income inequality.

The empirical investigation is implemented for 32 sub-Saharan African countries over the period 2000–2017, with the aid of vector autoregressions and a dynamic panel data model.

This study shows that MP has a significant impact on income inequality and the financial system plays an important role by dampening the dis-equalising effects of MP shocks. Both MP and FD directly exert redistributive effects. However, the financial system appears to wield the greatest impact and contribute more to the inequality dynamics.

The policy-relevant conclusion is that the financial system is crucial for the monetary transmission mechanism and the effects of MP actions. As the economy develops financially, it may require less movement in the policy position to achieve the desired policy outcome. Also, macroeconomic stabilisation policies may not be distributionally neutral and may have a role to play in averting longer-term increases in inequality.

Contrary to previous studies, this study indicates MP by the structural shocks to purge the MP stance of the issues of endogenous and anticipatory actions. A distinctive finding of this paper is that cross-country differences in monetary regimes and income explain a significant variation in the distributional impacts of monetary policy. Notwithstanding, the evidence shows that the strength of the transmission is more dependent on FD than the nature of the policy regime.