analysis (and in others) it tends to be the most important one to explain the impact of trade shocks on conflict onset.

It is important to note that the fixed effect specification effectively restricts the analysis of heterogeneity to those countries which have had a conflict onset in our period of analysis (i.e. since 1960). In this way we are under-estimating the cross-country heterogeneity with respect to their conflict propensity. A longer historical analysis would be able to exploit more fully this heterogeneity.

Table 8 summarizes the results of these regressions. It reports the range of values of the conditioning variable for which the marginal effect of the trade variable on conflict onset becomes not significantly different from zero (at the 10% level). We report this range only when in the rest of the values’ range the marginal effect is significant. If the marginal effect of price shocks is always or never statistically different from zero across the entire values’ range, then we report “No diff.” (no difference). This allows us to identify those conditions that make certain countries particularly vulnerable or resilient to the shocks.

Figure 1 provides a graphic example of our results for _Px_ using two different conditioning factors. The upper panel presents the curve describing the marginal effect of _Px_ along with its 90% confidence interval across the range of values of the accountability measure (from ICRG data). The downward slope indicates that the effect of _Px_ becomes less significant as one moves from low to high accountability country-years (i.e. from left to right). In particular, for accountability values above 3 the effect becomes not significantly different from zero. Similarly, the upward sloping curve in the lower panel indicates that the _Px_ effect on conflict becomes larger for country-year characterized by at least one conflict in contiguous countries. In fact, the Px effect (while positive) is not significantly different from zero for country-years pairs with peaceful neighbors.

The first thing to note from the results in table 8 is that there appears to be a high degree of heterogeneity in the effects of Px (and of its sub-component point-source Px) on conflict. This heterogeneity goes by and large in the expected direction. Export shocks have lower effects on conflict in countries that are located in peaceful neighborhoods, that have lower ethnic divisions and economic inequality, that have better governance, and that have some distortions to their agricultural markets.

Variables related to grievances and to conditions in neighboring countries appear to be particularly important in determining the effect of _Px_ on conflict. In countries with sufficiently low levels of economic inequality and of ethnic divisions (whether measured through ethnic polarization or fractionalization), _Px_ and point-source _Px_ have no statistically significant effect on conflict probability. Similarly, _Px_ and point-source _Px_ do not have a significant impact on conflict in countries which didn’t experience any conflict in the previous 10 years. Similarly, the probability of conflict in countries whose neighbors are not in conflict, or that have sufficiently intense trade with their neighbors, is not significantly affected by export shocks.

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