Afghanistan: The Economic Impact of Armed Conflict

This study examines the economic impact of armed conflict in Afghanistan. During the armed conflict between 1978 and 2021, the country received 88 billion in official development assistance (ODA) and over 136 billion in war-induced USAID funding. We found that the one-year Afghan armed conflict, with an average of 17, 661 battle-related deaths, increases the GDP per capita by at least 1. 9%. Comparatively, a one-year US-led war relative to a USSR-led war increases the GDP per capita by at least 5. 7%; in contrast, a one-year civil war reduces it by 4. 1%. In addition, our cost estimation suggests that between 2002 and 2021, at least 40. 9 ± 5% billion (45. 9%) of the Afghan state budget is spent on war-related and war-affected institutions. This is equal to 1, 062% of Afghanistan’s total GDP in 2002 and 280% in 2021. Moreover, this study will be helpful in understanding the implications of the Sustainable Development Goals and achieving specific targets such as Goal 8 (economic growth) and Goal 16 (peace and inclusive societies) in Afghanistan. Keywords. Economic impact, GDP, armed conflict, USSR-led War, US-led War, civil war, Afghanistan.