Abstract : In this paper we investigate the impact of local competition for public funds on conflict in Indonesia. We use a triple differences approach that exploits an exogenous source of variation in competition given by the number of villages that compete for sub-district level funds. We find a small but significant impact of competition on conflict. Larger effects are found for local (within-village) and ethnic-type conflict. We provide a number of potential mechanisms that might explain our findings.
Joint research unit 7235
