Economics of War and Peace: Economic, Legal, and Political Perspectives

Emerald Group Publishing Limited
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  • Chapter 11 Regional integration and militarised interstate disputes: An empirical analysis

    Purpose – This chapter aims to position regional integration in the Kantian peace tripod and to test whether regional economic integration has a significant effect in reducing militarised interstate disputes.Methodology – It uses logistic regression on cross-sectional–time-series data and a generalised estimating equation.Findings – The analysis shows that regional integration had a significant impact in reducing militarised interstate disputes between 1950 and 2000.Practical implications – This chapter may provide a new dimension to the academic discussion on the Kantian peace proposition, and encourage policy makers in less integrated regions to integrate with their neighbouring states in a bid to minimise political tensions.Originality – The chapter is based on original data on regional integration collected by the author.

  • Chapter 4 Arms export controls and the proliferation of military technology

    Purpose – To examine the implications of arms export controls on the international spread of weapons production and innovation.Methodology/approach – The chapter analyses predicted responses to arms export controls, drawing on existing literature. It considers incentives to potential buyer countries to develop their own substitutes and a case study of Australia's response to US denial of access to electronic warfare self-protection (EWSP) technology for fighter aircraft.Findings – Spurred by the US denial of access to relevant EWSP, Australia devoted many years to developing a homegrown substitute. Although Australia achieved some success, the United States ultimately granted Australia access to the technology. Australia then abandoned research, design and development (RD&D) on EWSP for fast jets in 2009. Cause and effect remain a matter of debate.Research limitations/implications – Insight into the real-world value of the theory is limited by the use of a single case study. Such cases supported by publicly available information are, however, scarce. Countries seeking to circumvent export controls must expect to incur high costs and uncertain outcomes.Practical implications – Policy-makers should be wary about committing large budgets in developing substitutes for new technologies denied them through export controls. Such efforts may, however, offer the possibility of putting suppliers under pressure unavailable from other actions.Social implications – Arms export controls designed to limit proliferation of weapons create incentives for states to develop their capabilities for new arms production and to develop new weapons-related knowledge.Originality/value of the chapter – This chapter provides a new case study which illustrates an innovative approach to arms export control analysis.

  • Foreword

    The book includes a set of chapters primarily to investigate the link between economics and conflicts. Although the subject matter has been presented in some other volumes in this series, this book spans a wider area covering cross fertilisation of disciplines and the role of law and institutions. The cross-disciplinary approach is necessary because some pure economists are presenting their findings in the area of politics and international relations. Some contributors are asking the questions about the economic value of peace. For that purpose they are using sophisticated scientific methods to analyze domestic and international conflicts. A related specific question is asked about the cost saving by privatising military prisons rather than contracting. This substitution has implications in other areas such as contracting military operations at the time of war. Of course, this cost savings should be weighed against motivation of the soldiers to fight. The question of comparative cost also arises in the technology transfer of military goods without giving out sensitive information and at the same time, concerned about competition from indigenous capabilities of substitutions. This alternative will induce proliferation of arms capabilities of other countries.

  • About the authors

    Aditya Agrawal is a scholarship graduate from Bond University (2006, first class honors in Management Science) and the 2007–2008 summer scholar at the Strategic and Defence Studies Centre, Australian National University. He commenced work at the University College, Australian Defence Force Academy in June 2008 and is currently reading for his doctorate in military outsourcing. Previously he has worked with both the corporate sector and the government departments. He has published in scholarly journals and peer-reviewed conferences and was awarded the Best Paper Prize at the national Australian Conference on Information Systems (ACIS 2007).

  • Chapter 2 A method to compute a peace gross world product by country and by economic sector

    Purpose – The chapter reports on an attempt to compute the size of gross world product (GWP) under the assumption that all violence ceases.Methodology/approach – Spreadsheet-based simulations, given seed values taken from extensive literature review; this is done, for 2007, in nominal foreign exchange–based US dollars (USD) as well as in purchasing power parity (ppp)–based dollars (international dollars).Beneficial economic effects from more internal peace (nonviolence within countries) as well from external peace (nonviolence between and among countries) are calculated for each of 140 countries. In addition, we compute sectoral economic effects for the United States.Findings – For 2007, the simulations suggest that in a state of nonviolence the world economy could have been larger by 4.8 trillion dollars, or 8.7 per cent of actual GWP, when measured in nominal, foreign exchange–based USD, or by 6.0 trillion international dollars, or 9.2 per cent of GWP, when measured in purchasing power parity values.Limitations – The simulations are based on disparate values found in the literature to seed the spreadsheet calculations; various assumptions are made that would need to be confirmed through country- and sector-specific studies.Practical implications – Knowledge of the potential size of forgone economic benefits due to violence can assist to set out global violence reduction goals in order to achieve measurable economic results.Originality/value of chapter – To our knowledge this is the first attempt to calculate the size of the worldwide economic benefits forgone due to violence.

  • Chapter 6 Terrorism and violent internal conflict in post-soeharto Indonesia: Beyond the Jihadi prism of analysis

    Purpose – Since September 2001, most studies of terrorism have focused on the motives and operations of transnational terrorist groups, especially Islamist jihadi groups. Yet statistics from the past decade indicate that most terrorist attacks occurred within violent internal conflicts. Indonesia is a case in point. Following the fall of the Soeharto regime in 1998, terrorism became a hallmark of separatist and inter-communal violence that cost the lives of thousands of Indonesians. The aim of this chapter is to look beyond the jihadi-focused prism of terrorism studies and to examine the secessionist conflicts in Aceh and Papua to determine why and to what extent terrorism was used by the Free Aceh Movement (GAM) and the Free Papua Movement (OPM) respectively, and the role that economic factors played in the process.Methodology – By synthesising the causes of violent internal conflicts and of terrorism, a framework of societal and organisational factors is constructed to explain why terrorism was used by GAM and OPM, and why, in the case of GAM it stopped, while in the case of OPM, it continues.Findings – In general, socio-economic and political factors rather than religious ideology explain why terrorism was used by GAM and continues to be used by OPM in their respective secessionist conflicts. Economic grievances fuelled by resource exploitation and inequitable sharing of resource rents have been contributing factors.Originality/value of chapter – The analysis departs from previous approaches, which have focused primarily on the causes and course of the conflicts themselves and not on when and why such conflicts have included terrorist attacks.

  • Author Index
  • Chapter 5 Probing the roles of governance and greed in civil strife in West Africa

    Purpose – This chapter aims to explore the causes of civil war in West Africa, including the perspectives of those directly involved, both those involved voluntarily and those involved against their will. To this end, we examine the three contiguous war – afflicted coastal countries of Sierra Leone, Liberia and Ivory Coast and as a counterweight, Ghana which has escaped civil war.Methodology – Brief country case studies are used to explore the motivations of leaders and followers which often diverge. This chapter examines four West African countries:•Sierra Leone and Liberia, which have suffered classic brutal, ‘third war’ civil wars (Holsti, K. (Ed.). (1996). Wars of the third kind. In: The state, war and the state of war. Cambridge: Cambridge University Press).•Ivory Coast, once seen as the West African ‘beacon of stability’ (Royce, E. (2003). Testimony. US House of Representatives Subcommittee on Africa, 2nd February, p. 12) but now suffering a seventh year of civil conflict.•Ghana, the counter case, which has so far survived multiple military coups without descending into national conflagration.To demonstrate the basic features these countries share in common and to suggest some areas where they diverge, we present core socio-economic data in Table 1.The respondent data on which much of the analysis is based was collected by Dele Ogunmola from individual interviews, and focus group discussions. In the case of Ivory Coast, there was also an e-interview with a medical missionary who experienced the early stages of the war. Given the tense nature of the situation, for both the individual interviews and the focus groups the selection of participants was purposive. People were selected who were willing to talk about their involvement and could represent a range of different roles and experiences. Thus, for example, the Makeni focus group quoted was recruited at Sumbaya village, which was virtually razed by the rebels. Minor warlords were interviewed but not, regrettably, randomly selected. We also refer to the interviews of ex-rebels conducted in 2009 by John-Idriss Lahai, a former member of the Sierra Leonian Civil Defence Forces and current PhD Student at the University of New England.Findings – Interviewing in these countries still requires courage on both sides, and while we accept that respondents (especially those at risk of prosecution) may well prevaricate, the overall impression is one of the striking frankness. Most argued that the war was messy and the participants had mixed motivations. The findings confirm that, while grievances play a significant role in providing the fuel for West African civil wars, the greed of both national and international players serves to prolong them. Though Sierra Leone and Liberia experienced opportunistic wars, the Ivory Coast is torn apart over the definition of citizenship. Ghana has survived due to leadership which facilitated economic growth, curbed corruption and prioritised provision of basic services.Limitations – This is not the place to detail the multitude of coups, wars and treaty negotiations that make up the troubled history of the region (see Adebajo, A. (2002). Building peace in West Africa: Liberia, Sierra Leone and Guinea-Bissau. Boulder, CO: Lynne Rienner. Parallel timelines for each country would demonstrate many interactions across the region, such as the spread of subaltern coups, but at the cost of presenting a long and confusing history. It is enough to stress that these colonially defined countries are linked across borders that are porous to ideas, rebels, refugees and diamonds alike.

  • List of contributors
  • Chapter 10 Peace through trade? Econophoria in Northeast Asia

    Purpose – This chapter assesses the extent to which ‘Econophoria’ (all problems seen as surmountable though development and economic growth) is justified with regard to the maintenance of peace in Northeast Asia where, despite ongoing tensions, outright war has been averted for half a century. Given that peace talks, international organisations and democratic dyads (alternative explanations for the absence of war) are in short supply, and in the context of regional economic ‘miracles’, the various economic peace mechanisms are addressed through analysis of Northeast Asian data.Design/methodology/approach – The impact of economic development in relation to war and peace is seen to operate at both the macro-level between states (trade, interdependence) and at a micro, transformative level within them. This chapter applies Northeast Asian data to each of the theoretical traditions of economic peace to assess whether there is sufficient fit to provide grounds for optimism and therefore econophoria.Findings – Owing to the limitations of socio-economic transformation and interdependence the impact of the spread of commerce is felt more at a socially constructed rather than rational cost–benefit level. Peace in Northeast Asia has not come through trade, but trade has facilitated improved conditions for the construction of a peaceful regional community.Originality/value – This chapter offers grounds for cautious optimism with regard to the relative stability of the peace regime in a region considered one of the most dangerous in the world. However, it also warns levels of economic development and interdependence which are insufficient to take an econophoric determinist stance.

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