Politics Remains but Economics Leads and Peace Follows: Making a Case for India-Pakistan Peace Process in line with China Model
AbstractThe paper traces the causal links of Indo-Pakistan conflict with trade, military expenditure and democracy under multivariate time series framework from 1950-2005. We find that higher exports to outside world and increased bilateral trade have high propensity to reduce hostilities between both nations. Furthermore, historically high military expenditures in Pakistan have been a direct outcome of continued hostilities in its Eastern borders whereas Indian military expenditure is weakly related with the conflict. Political orientation of both countries does not seem to significantly affect the conflict either. Overall, the findings support the case for liberal (economic) peace than political (democratic) peace.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 3075.
Date of creation: Mar 2007
Date of revision:
Inter-state conflict and trade; democracy and conflict; conflict and economic development;
Find related papers by JEL classification:
- F15 - International Economics - - Trade - - - Economic Integration
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- Polachek, Solomon W. & Seiglie, Carlos, 2007.
"Trade, Peace and Democracy: An Analysis of Dyadic Dispute,"
Handbook of Defense Economics,
- Polachek, Solomon & Seiglie, Carlos, 2006. "Trade, Peace and Democracy: An Analysis of Dyadic Dispute," IZA Discussion Papers 2170, Institute for the Study of Labor (IZA).
- Polachek, Solomon W, 1997. "Why Democracies Cooperate More and Fight Less: The Relationship between International Trade and Cooperation," Review of International Economics, Wiley Blackwell, vol. 5(3), pages 295-309, August.
- Chang, Yuan-Ching & Polachek, Solomon W. & Robst, John, 2004. "Conflict and trade: the relationship between geographic distance and international interactions," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 33(4), pages 491-509, September.
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