Skip to main content

Insurgent Compensation: Evidence from Iraq

Author(s): Bahney, Benjamin W; Iyengar, Radha K; Johnston, Patrick B; Jung, Danielle F; Shapiro, Jacob N; et al

To refer to this page use:
Abstract: Participating in insurgency is physically risky. Why do people do so? Using new data on 3,799 payments to insurgent fighters by Al Qa'ida Iraq, we find that: (i) wages were extremely low relative to outside options, even compared to unskilled labor; (ii) the estimated risk premium is negative; and (iii) the wage schedule favors equalization and provides additional compensation for larger families. These results challenge the notion that fighters are paid their marginal product, or the opportunity cost of their time. They may be consistent with a "lemons" model in which fighters signal commitment by accepting low wages.
Publication Date: May-2013
Citation: Bahney, Benjamin W, Iyengar, Radha K, Johnston, Patrick B, Jung, Danielle F, Shapiro, Jacob N, Shatz, Howard J. (2013). Insurgent Compensation: Evidence from Iraq. American Economic Review, 103 (3), 518 - 522. doi:10.1257/aer.103.3.518
DOI: doi:10.1257/aer.103.3.518
ISSN: 0002-8282
Pages: 518 - 522
Type of Material: Journal Article
Journal/Proceeding Title: American Economic Review
Version: Final published version. Article is made available in OAR by the publisher's permission or policy.

Items in OAR@Princeton are protected by copyright, with all rights reserved, unless otherwise indicated.