ABSTRACT
I wish to explore the logic of economic efficiency as it is applied to ethnic conflict within a geographic region or even a nation state. Many economists believe that a smaller economy means less wealth for all participants. The less extensive the division of labor the lower will be the hourly productivity of the workforce as well as the per capita output. This suggests that an eliminationist policy by which one group seeks to sanction or banish another group will lower living standards by reducing the population of traders and/or encumbering trade with extra transaction costs.
