Band 18, Heft 2 - "Political Economy Studies on the Israeli-Palestinian Conflict" Special issue edited by Esteban F. Klor and Raul Caruso

This paper analyzes the relationship between youth unemployment and Palestinian violence. First a qualitative explanation of the underlying mechanism is given. Eventually, empirical results suggest that there is a positive association between the growth rate of youth unemployment and the brutality and incidence of violence, proxied by the numbers of victims, and incidents. Results also show that: (i) there is a negative association between the added value in the agricultural sector and both measures of violence; (ii) there is a positive association between the share of employment in agriculture and violence; (iii) there is a negative association between manufacturing added value and brutality of incidents. Results also suggest that male youth unemployment rather than female unemployment helps to explain Palestinian violence.

This study provides circumstantial evidence for the impact of permits for employment in Israel on the Palestinian labor force in the West Bank during the late Intifada period and its aftermath (2005–2008). The study utilizes a unique dataset that merges data from the Palestinian Labor Force Survey with Israeli administrative data on permits for employment in Israel. The study quantifies the increase in Palestinian employment in the Israeli and Palestinian economies and the decrease in Palestinian unemployment, as well as the drop in the return to schooling in a West Bank governorate, which coincided with an increase in the number of permits issued for residents of that governorate. These results reflect the short-run benefits for the un-skilled Palestinian labor force as well as the adverse long-run effects of Palestinian employment in Israel on human capital accumulation.

A large number of studies show that war and terrorism have a significant effect on individuals’ political attitudes. Yet, this extensive literature does not inspect the mechanisms behind this effect. This paper concentrates on one possible mechanism, by differentiating between the human toll of terror and war and the economic costs they cause. For these purposes we focus on the Israeli-Palestinian conflict, and use variation in the level of violence across time and space together with localities’ different exposure to the tourism sector to estimate their respective effects on political attitudes. Our results suggest that whereas fatalities from the conflict make Israelis more willing to grant territorial concessions to the Palestinians, the associated economic costs of conflict do not have a consistent significant effect on individuals’ political attitudes.

The ability of a government to prevent violence and threats against the state and its citizens depends on the government’s ability to deter enemies from engaging in such tactics. Because deterrence relies on both capabilities and credibility it is not clear that governments that emerge within the same state are similarly effective at deterring attacks. We examine whether partisan politics and the decision to use force against an enemy or those thought to be associated with an enemy—in our case terrorists—affects successful deterrence. We test our expectations using data from the Israeli-Palestine conflict between the years 1979 and 2003. The results suggest that governments of the right are more effective at using force to deter future terrorist attacks.