Abstract for: Farmers, Bandits, Soldiers: A model for addressing peace agendas

This paper models an economy of farmers, bandits and soldiers. In addition to the economic factors affecting the economy studied by Saeed and Pavlov (2008), we examine also the effects of two psychological factors broadly categorized as exposure to violence and group identity. Within this environment, we conduct simulation experiments (1) infusing the economy with additional agents of each type under different assumptions about rational economic behavior, psychological influences and the writ of government, (2) changing the parameters representing the productivities and behavioral scaling factors in the economy, and (3) adding external flows to the incomes of each type of agent. Our experiments indicate that the optimal policy for promoting peace involves increasing farmer productivity, strengthening the writ of government, downplaying the prestige of soldiers and reforming institutions so corruption and the extraction of ransom from the public are reduced. Key words: peace economics, political economy, conflict resolution, behavioral economics, psychology, public policy, system dynamics, computer simulation.