Peace is Bad For Business. See: Angolan Diamond Industry

Strange that a strong central system, even if it is run by warlords, may sprout the flowers of economic prosperity. Such was the case in Angola, a former Portuguese colony left in shambles when the Europeans left in 1975. Rebel commander Jonas Savimbi made good use of the chaos, armed himself and ran the country's diamond exporting industry, raking in good money from what are commonly known as blood diamonds.

Ray Fisman in Slate chronicles a case study of Savimbi's downfall, and how investors yanked capital as soon as he was killed in combat. Fisman writes:

Most people, including nearly all of my first-year MBA students, think that the key to business success is cheaply and efficiently producing something people want to buy. If this were the case, then war's end should have made Angolan miners and their shareholders richer as production costs plummeted. But the effect of peace on diamond mining in Angola shows that more important than producing something well is doing it better than the competition—and the potential competition.

The Inquirer has reported extensively on the Dirty Diamond Industry, so to go further, how emblematic is Fisman's example of the security situation in Angola of other industries thriving off of conflict?

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