Of the 27 major armed conflicts that occurred in 1999, all but two took place within national boundaries. As an impediment to development, internal rebellion especially hurts the world's poorest countries.
Most rebellions are ostensibly in pursuit of a cause, supported by a narrative of grievance.
But since grievance-assuagement through rebellion is a public good which a government will not supply, economists predict such rebellions would be rare. This paper sets up a simple rational choice model of greed-rebellion and contrasts its predictions with those of a simple grievance model. Some countries return to conflict repeatedly. It is shown why such a feedback effect might be present in both greed-motivated and grievance rebellions. The results contrast with conventional beliefs about the causes of conflict.