TY  - RPRT
        AU  - Artuc, Erhan
AU  - Gomez-Parra, Nicolas
AU  - Onder, Harun
        TI  - The True Cost of War
        PY  - 2023/Jan/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 15900
        UR  - https://www.iza.org/publications/dp15900
        AB  - Measuring the economic impact of a war is a daunting task. Common indicators like casualties, infrastructure damages, and gross domestic product effects provide useful benchmarks, but they fail to capture the complex welfare effects of wars. This paper proposes a new method to estimate the welfare impact of conflicts and remedy common data constraints in conflict-affected environments. The method first estimates how agents regard spatial welfare differentials by voting with their feet, using pre-conflict data. Then, it infers a lower-bound estimate for the conflict-driven welfare shock from partially observed post-conflict migration patterns. A case study of the conflict in Eastern Ukraine between 2014 and 2019 shows a large lower-bound welfare loss for Donetsk residents equivalent to between 7.3 and 24.8 percent of life-time income depending on agents' time preferences.
        KW  - conflict
KW  - revealed-preferences
KW  - internally displaced people
        ER  -