The Cost of War: A Focus on Nicaragua's Civil War and Some Reflections on Guatemala

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Economics | Latin American Studies | Social and Behavioral Sciences


Ernest Diedrich


Both Nicaragua and Guatemala experienced civil conflicts in the recent past. In this study the process of these conflicts is examined in a number of ways. The price of the Nicaraguan conflict is determined by measuring direct costs to the Nicaraguan government, as well as by measuring the indirect costs of the war. The indirect cost analysis is computed through a hypothetical model that examines consumption rates in both the actual economy, and a war-free economy. Guatemala's situation is also examined in order to provide a glimpse of the social costs of civil conflict. The two countries experiences are compared and the cost of the civil conflicts are then estimated.