A puzzling aspect of the 1992-95 Bosnia war - the intra-Muslim civil war in northwestern Bosnia - can highlight the role of local elites in capturing important interaction effects between micro-level economic incentives and macr-level ethnic cleavages in civil wars. During civil wars where the broader conflict is cast in macr-ethnic terms, economic incentives can seriously affect intragroup behavior. Ethnic group unity can be undermined by the presence of charismatic local elites who can guarantee the survival of their local constituents, while providing access to micro-level economic payoffs.