Economic globalization and liberalization have been blamed for numerous social ills over the last two decades, including a sharp rise in interethnic violence in countries all over the world. Not so, say the results of a study conducted by researchers from McGill University and published in the current issue of International Studies Quarterly.

According to Dr. Stephen Saideman and former student David Steinberg, the more government intervention there is in the local economy, the more likely inter-ethnic violence and rebellion becomes. Conversely, the more economically open a society is, the less likely such violence becomes.

"Our study counters the idea that a liberalized economy is worse for ethnic groups. Minorities are more likely to be on the outside of the political system," explained Saideman, associate professor and associate director of graduate studies in the Department of Political Science, and Canada Research Chair in International Security and Ethnic Conflict. "So, if the government is involved in the economy, minorities are more likely to be affected by the whims of the state than by the whims of the market."

Utilizing their own original research, along with the Minorities at Risk dataset compiled by their colleagues at the University of Maryland, Steinberg and Saideman's results show that government intervention in the economy leads to a spiral of political competition among groups to gain control of the state and the economic spoils it distributes.

"Thus groups on the outs feel threatened because they have no control, which can lead to open rebellion," Saideman said, "while those who are in power become terrified of losing control, as occurred in Serbia. Before the war the Serbs controlled a large hunk of the Yugoslav political system and it was their fear of losing it that led to war."

Moreover, the researchers said, their results were reasonably consistent in virtually every society they studied, regardless of political system.

"We're not just talking about command economies like the old Soviet Union or Yugoslavia," he said. "We control for regime type, so whether a country is a democracy or not, statistically and probabilistically, the more government involvement there is in the economy, the more likely ethnic conflict is."

Though inter-ethnic violence is somewhat more likely to occur in less-developed economies, Saideman said, similar interventions even in the industrialized world have the potential to sow serious intergroup tensions.

"Ironically, look at how the government of the United States is now in the process of buying up a large hunk of the economy to bail out Wall Street," he said. "In the future this will give people who are denied loans or who have other economic grievances an incentive to blame the government. They won't consider factors like oil shocks and housing bubbles, it will all be laid on the government's doorstep."