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The economic effect of a resolution of the Nagorno-Karabakh conflict on Armenia and Azerbaijan

The Nagorno-Karabakh conflict is a long-simmering conflict between Armenia and Azerbaijan over the national affiliation of the Nagorno-Karabakh region in the South Caucasus. In addition to the humanitarian and political consequences, the conflict situation is also causing economic distortions. The economic effects of a conflict settlement are examined in more detail in this study.

Military conflicts always have an economic impact, as they tie up resources in unproductive areas, can affect interstate trade and prevent investment. It is therefore obvious that conflict resolution may be highly desirable not only for humanitarian and political reasons, but also from an economic point of view.

An end to the long-running conflict over Nagorno-Karabakh could thus be of great importance for the economies of Armenia and Azerbaijan. In order to evaluate these effects in more detail, the study attempts to quantify the economic effects of a peace agreement.

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Further references on the topic

The economic impact of mutual EU-Russia sanctions on the EU. Plausibility assessment of recent studies by simple estimation

The mutual sanctions imposed between Russia and the EU in the wake of the Crimea crisis in 2014 have weighed on bilateral trade. Estimates of the impact of the decline in trade on gross domestic product vary.

In order to quantify the exact impact of sanctions on trade and the gross domestic product of the European Union, Berlin Economics conducted a simple plausibility check of previous studies. While the estimates of the impact on trade were largely plausible, there were significant discrepancies with regard to the impact on gross domestic product.

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