The economic cost of conflict in Northern Ireland
This study explores the effect of conflict on GDP in Northern Ireland. A synthetic control region constructed as a weighted average of other UK regions provides an estimate of counterfactual ‘no-conflict’ GDP. Comparing this with actual per capita GDP suggests a negative impact of up to 10%. Excluding the increased grants provided in response to the conflict, a 15-20% reduction is evident. Most forms of terrorist activity had negative effects over the period 1969-1997. Deaths attributable to Republican paramilitary groups or to the State appear to have a greater and more lasting impact on GDP than deaths attributable to Loyalist paramilitaries.
Dorsett, R. (2013) The effect of the Troubles on GDP in Northern Ireland European Journal of Political Economy 29: 119-133