Modeling conflict impact and postconflict reconstruction − The case of Yemen

Evidence-based planning for in-conflict countries is often constrained by missing data and the lack of appropriate analytical tools. To overcome these constraints, we use a Computable General Equilibrium (CGE) model combined with Systematic Sensitivity Analysis (SSA) to investigate the impact of conflict on Yemen's economy and to analyze potential post-conflict recovery pathways. Our results suggest that conflict-related disruptions in agriculture and mining sent devastating shockwaves throughout the economy, constituting the lion's share of the country's economic losses and increase in poverty. Results suggest that supporting agriculture should have the highest priority as the sector's reconstruction has the largest positive impact on growth and poverty reduction, followed by the mining sector. However, our estimates also suggest that foreseeable restoration of the pre-war economic status quo is unlikely. In addition to serving as a direct input for Yemen's reconstruction planning, our paper also demonstrates the usefulness of economy-wide models for conflict and post-conflict assessments.