Tim Besley, Thiemo Fetzer, Hannes Felix Mueller, Thursday, February 28, 2013

Somali piracy has created a major externality due to disruption to shipping, especially in the Gulf of Aden. How costly is this anarchy? This column analyses micro-data on individual shipping contracts and finds that piracy increased transport costs by around 8%. The $120 million in net revenues that pirates generate are more than offset by the costs borne by the shipping industry, which lie between $0.9 billion and $3.3 billion.

Graziella Bertocchi, Tuesday, April 6, 2010

The causes and implications of state fragility – also known as state failure – are not yet well understood. This column explores the determinants of state fragility in sub-Saharan Africa and finds that institutions – as measured by civil liberties and the number of revolutions – are the main drivers. It says institutions trump economic, geographic, and historical factors.

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