Artisanal or industrial conflict minerals? Evidence from Eastern Congo

Abstract

• This study investigates how ASM and LSM affect local conflict in Eastern DRC. • We exploit variation in conflict, mineral prices and LSM across space and time. • Rising mineral prices increase conflict around ASM, but not around LSM. • The expansion of LSM production activities decreases battles but increases riots. • When LSM production expands in ASM areas, violence against civilians rises. Existing research suggests a strong link between mining and local conflict but makes no distinction between artisanal and industrial mining. We exploit variation in mineral prices and the granting of industrial mining concessions to investigate how the mode of extraction affects conflict in Eastern Congo. Rising mineral prices increase battles over artisanal mines, indicating competition between armed groups. This effect is much less pronounced for industrial mining. Moreover, the expansion of industrial mining decreases battles, suggesting that companies can secure their concessions. Such expansion does, however, trigger riots, and, when it crowds out artisanal mining, also increases violence against civilians and looting. In line with case-study evidence, these negative effects only materialize when industrial mining companies expand their activities from the research to the production phase.