Abstract

This paper examines the factors influencing economic recovery in post-conflict settings, with a primary
emphasis on understanding the elements that contribute to heterogeneity in growth in postconflict
countries and identifying the specific variables associated with achieving above-average
growth rates. Utilizing panel data encompassing economic, social, and political variables, as well
as conflict-related data from 41 countries between 1970 and 2018, the study finds that terms of
trade, foreign direct investment (FDI), capital formation, and education play a crucial role in
influencing economic growth. These variables have a statistically significant impact on achieving
above-average growth rates in the aftermath of conflicts. However, the paper finds that constraints
on executives, serving as a proxy for institutions, turned out to be insignificant in relation
to post-conflict economic performance. Regarding the timing of recovery, the paper identifies an
initial 7-year post-conflict transition period marked by a notable catch-up effect. These findings
contribute valuable insights to the existing literature on post-conflict economic growth, enriching
our understanding of the dynamics of recovery in these challenging contexts and offering potential
implications for policies and interventions aimed at fostering sustainable progress and resilience.