This article reports on the potential macroeconomic benefits of peace stemming from a reduction in farmer-pastoralist violence in four Middle Belt states of Nigeria (Benue, Kaduna, Nasarawa, and Plateau). Farmers and pastoralists routinely clash over access to farmland, grazing areas, stock routes, and water points for both animals and households. Farmer-pastoralist violence in these states is a relatively low-intensity form of conflict, but it is regionally widespread and chronic, and its incidence is arguably increasing. Using estimates of potential income benefits of peace at the household-level derived from a related study, we herein derive macroeconomic benefits via an input-output model of the Nigerian economy. We estimate these benefits to amount to around 2.8 percent of the nominal Nigerian GDP (or around 0.8 percent of the total Nigerian GDP, inclusive of the informal sector), representing a major macroeconomic opportunity. We break out these benefits by sector, showing that the sectors that stand to gain most from peace are the crop production, food and beverage, livestock, and chemical and petroleum industries.T his article reports on a study of potential macroeconomic benefits of peace subsequent to a hypothetical reduction in farmer-pastoralist violence in four Middle Belt states of Nigeria (Benue, Kaduna, Nasarawe, and Plateau). Estimates of potential income benefits of peace at the household-level, derived in a related study, are used here to compute the macroeconomic benefits-both in the aggregate as well as disaggregated by industrial sector-via an input-output model of the Nigerian economy. While somewhat experimental, this spreadsheet-based approach has the advantage of producing industry-by-industry estimates in a fairly parsimonious way. 1Other violent conflicts in Nigeria routinely capture media headlines and the attention of peace researchers, usually in regard to petroleum extraction-related conflict in the Niger delta region or in regard to violent extremism in the country's northeast. In contrast, we focus on Middle Belt states and demonstrate that addressing farmer-pastoralist violence, a low-intensity but pervasive form of conflict there as well as across the Sahel, is a major opportunity for macroeconomic improvement for Africa's largest economy. We break out the benefits by sector in an exercise that may help policymakers identify potential private sector partners in peacemaking. We find that the top sectoral beneficiaries are the food and beverage, agriculture, and the chemical and petroleum industries.2 Background Nigeria's ethnically and religiously diverse Middle Belt has experienced recurrent eruptions of violence over the past several decades. Disputes between farmers and pastoralists arise from disagreements over access to farmland, grazing areas, stock routes, and water points for both animals and households. A range of factors underlie these disputes, including increased competition for land (potentially driven by desertification, climate change, and population grow...

This study estimates the relationship between violent conflict and household income in four states of Nigeria's Middle Belt region (Benue, Kaduna, Nasarawa, and Plateau) where farmers and pastoralists routinely clash over access to farmland, grazing areas, stock routes, and water points for animals and households. Although relatively low in intensity, this form of violence is widespread, persistent, and arguably increasing in its incidence. We obtained data on income and household-level violence exposure from an original household survey administered in September 2014. Employing a negative binomial instrumental variables model, we find an inverse relation between violence and household incomes. Incomes could be increased by between 64 to 210 percent of current levels if violence related to farmer-pastoralist conflict in the four study states were reduced to near-zero. Cumulatively, we find that forgone income represents 10.2 percent of the combined official state domestic product in the study area. This is high when compared to the costs of conflict measured in other studies, even as our study takes account only of microeconomic costs. After incorporating an estimate of the size of the informal economy, the microeconomic cost of farmer-pastoralist conflict to the total economy is approximately 2.9 percent.T his study seeks to understand the relationship between the violence that results from farmer-pastoralist conflict and household incomes in four states of the Middle Belt region of Nigeria, namely, Benue, Kaduna, Nasarawa, and Plateau. We created and administered an original, one-shot household survey designed to answer this research question: What is the effect of farmer-pastoralist violence on household income, both in general and by livelihood strategy? 1 The analysis estimates income foregone as a result of violent farmer-pastoralist conflict. Our approach differs from typical accounting-cost attempts to sum the cost of conflict or benefits of peace. In contrast, we estimate household income that could be generated were violence reduced, as income loss is one of the many costs imposed on an economy as a result of violent conflict. We isolate the costs borne by households in terms of their ability to consume, save, and accumulate wealth as a result of lost income. Our work also generates microlevel data for use in a subsequent estimation of the macroeconomic cost of violent farmer-pastoralist conflict in a related study, also published in this issue. 2 Background Farmer-pastoralist conflict in the Middle BeltNigeria's ethnically and religiously diverse Middle Belt has experienced recurrent eruptions of violence over the past several decades. Disputes between pastoralists and farmers arise from disagreements over the use of land around farmland, grazing areas, stock routes, and access to water points for both animals and households. A range of interrelated factors underlie these disputes, including increased competition for land (arguably driven by desertification, climate change, and population grow...

Nigeria’s ethnically and religiously diverse Middle Belt has experienced recurrent eruptions of violence over the past several decades. Disputes between pastoralists and farmers arise from disagreements over access to farmland, grazing areas, stock routes, and water points for both animals and households. Although relatively low in intensity, this form of violence is widespread, persistent, and arguably increasing in its incidence. This study seeks to answer the question: How has farmer-pastoralist conflict affected state internally-generated revenues (IGR)? The literature on the effect of violence on sub-national fiscal capacity is slim to none. We use a synthetic control approach to model how IGR for four conflict-affected states – Benue, Kaduna, Nasarawa, and Plateau – would have developed in the absence of violence. To account for the endogeneity criticism commonly leveled at such synthetic control analyses, we then use a fixed-effects IV model to estimate IGR losses predicted by the synthetic control analysis as a function of farmer-pastoralist fatalities. Our conservative estimates for percentage reduction to annual state IGR growth for the four states are 0%, 1.2%, 2.6%, and 12.1% respectively, implying that IGR is likely much more sensitive to conflict than GDP. In total, the four study states of Benue, Kaduna, Nasarawa, and Plateau are estimated to have lost between US$719,000 and US$2.3 million in 2010 US dollars, or 22–47% of their potential IGR collection during the period of intense.