Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/310329 
Year of Publication: 
2025
Series/Report no.: 
Kiel Working Paper No. 2280
Publisher: 
Kiel Institute for the World Economy (IfW Kiel), Kiel
Abstract: 
Economic resources are often seen as decisive for the outcomes of military conflicts. This paper asks whether "deeper pockets" help win wars. We construct a fine-grained dataset covering more than 700 interstate disputes and rely on exogenous resource price shocks to estimate the causal effect of windfall gains on winning chances in interstate conflicts. We find a statistically significant and quantitatively large impact of windfall gains on winning odds and show that a key channel of transmission is a surge in military spending, after an exogenous increase in government revenues.
Subjects: 
Interstate disputes
International wars
Commodity prices
Conflict outcomes
Military expenditures
JEL: 
D74
F51
H56
N40
Q02
Document Type: 
Working Paper

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