Violent political conflict has been documented to have comprehensive adverse effects on economic activity and, thus, substantially harm social welfare. As conflict escalations are often reported to fragment economic space, we suggest an empirical framework which allows for estimating changes in the size of markets often split by frontlines. This approach uses a differentiated goods oligopoly model to separate effects of conflict intensity on consumer demand, costs of trade, market size, and market structure. We combine daily sales of apples in Hebron - one of the focal points of the Israeli–Palestinian conflict - and variables quantifying complementary aspects of conflict intensity. Conflict is found to suppress demand and affect competition more significantly than it increases costs of trading. Simulations indicate a 15% reduction in total daily consumption during conflict of high intensity while a pacification would yield a 20% welfare gain. This empirical framework allows disentangling the effects of conflict on food markets. The results suggest that relief policies should consider alleviating effects of fragmentation of economic space, e.g., by ensuring humanitarian corridors.

中文翻译：

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暴力政治冲突对新鲜食品市场供应、需求和分割的影响

暴力政治冲突已被记录为对经济活动产生全面的不利影响，从而严重损害社会福利。由于经常报告冲突升级会破坏经济空间，我们建议建立一个经验框架，该框架允许估计经常被前线分裂的市场规模的变化。这种方法使用差异化商品寡头垄断模型来区分冲突强度对消费者需求、贸易成本、市场规模和市场结构的影响。我们将希伯伦（以色列-巴勒斯坦冲突的焦点之一）的苹果每日销售额与量化冲突强度互补方面的变量相结合。发现冲突比增加交易成本更能抑制需求和影响竞争。模拟表明，在高强度冲突期间，每日总消费量减少 15%，而安抚将产生 20% 的福利收益。这个经验框架可以理清冲突对粮食市场的影响。结果表明，救济政策应考虑减轻经济空间碎片化的影响，例如，通过确保人道主义走廊。