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Abstract

In order to meet humanitarian assistance programs, donor organizations like WFP need to procure food either locally or import it. Internal conflict may pose significant barriers to local and regional procurement programs like P4P. We develop a methodology to estimate the cost of conflict using a microeconomic setting. We examine the use of forward contracts to procure locally and derive a) what price should be paid to the suppliers, b) how should contracts be designed so that agents relinquish conflict and sign P4P contracts.

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