Globalization and Peace: Assessing New Directions in the Study of Trade and Conflict

Abstract

`Globalization' has largely superseded the term `economic interdependence' to describe the rapidly growing links between nations, economies, and societies. The effects that the internationalization of the world system has on social equality, the environment, and economic growth are, however, still largely disputed. In this article, we discuss the literature that covers another intensively debated issue and which attempts to assess the relationship between trade and interstate conflict. Although liberal economists maintain that economic interdependence exerts an unconditionally pacifying influence on interstate relations, we show that the most recent formal work expects that trade will have a negligible and, in the perspective of one important model at least, even an amplifying effect on conflict. Much empirical work, by contrast, supports the claim that the relationship between trade and conflict is direct and not mitigated by contextual factors. We review the different controversies on the link between economic interdependence and militarized disputes and outline some major challenges that have not yet been adequately dealt with in the scientific study of war and peace.