Since the mid-1990s, development aid in fragile states and conflict-affected countries has been framed in what is usually called the security-development nexus. According to international agencies’ discourse, development assistance is now part of conflict management tools. However, despite the profusion of recent work on the security-development nexus, there is no clear vision as to how development assistance can contribute to peacebuilding. Moreover, despite growing awareness among international agents and analysts on the potential negative impacts of international assistance, there is no clear understanding of the ways in which aid negatively impacts conflict dynamics. Building on the literature on the economic causes of conflict, I develop a theoretical framework linking aid practices to peace and conflict dynamics. I argue that, as it shapes the political economy of conflicts, aid may end up having detrimental impacts on the existence and depth of horizontal inequalities as well as the quality of the social contract. In Palestine, this translates into divisions between Hamas and Fatah as well as between Palestinian society and the Palestinian Authority.
