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Industry-Level Supply-Side Market Concentration and the Price of Military Conflict

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  • Jaya Wen

Abstract

In economics, supply-side market concentration profoundly impacts firm behavior. This dimension of economic interaction can be used to predict the conflict initiation of countries in the context of international relations. The following investigation uses industry-level trade data to define four new market concentration variables, which are incorporated into the traditional model of military conflict. The article finds that high dyadic market concentration significantly decreases the likelihood that a state initiated military conflict in the period 1962–2001, and argues that market concentration is an important factor in the trade–conflict relationship.

Suggested Citation

  • Jaya Wen, 2012. "Industry-Level Supply-Side Market Concentration and the Price of Military Conflict," Conflict Management and Peace Science, Peace Science Society (International), vol. 29(1), pages 79-92, February.
    • Handle: RePEc:sae:compsc:v:29:y:2012:i:1:p:79-92
    DOI: 10.1177/0738894211430281
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    1. Mark Gasiorowski & Solomon W. Polachek, 1982. "Conflict and Interdependence," Journal of Conflict Resolution, Peace Science Society (International), vol. 26(4), pages 709-729, December.
    2. Solomon William Polachek, 1980. "Conflict and Trade," Journal of Conflict Resolution, Peace Science Society (International), vol. 24(1), pages 55-78, March.
    3. Wagner, R. Harrison, 1988. "Economic interdependence, bargaining power, and political influence," International Organization, Cambridge University Press, vol. 42(3), pages 461-483, July.
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