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Interstate Conflict and International Trade

Author

Listed:
  • Michelle Garfinkel

    (University of California-Irvine)

  • Constantinos Syropoulos

    (School of Economics, Drexel University)

Abstract

We provide a selective overview of the literature on the linkages between interstate conflict and international trade, paying special attention to how trade openness (i) affects arming incentives, (ii) the channels through which its effects travel, and (iii) its consequences for the emergence of war (or peace) as an equilibrium outcome. We also discuss how restrictive trade policies may interact with national security concerns and what they imply for welfare.

Suggested Citation

  • Michelle Garfinkel & Constantinos Syropoulos, 2025. "Interstate Conflict and International Trade," Working Papers 202510, Center for Global Policy Analysis, LeBow College of Business, Drexel University.
    • Handle: RePEc:drx:wpaper:202510
    as

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    File URL: https://www.lebow.drexel.edu/sites/default/files/2025-04/202510-cgpa-interstate-conflict.pdf
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    References listed on IDEAS

    as
    1. Seitz, Michael & Tarasov, Alexander & Zakharenko, Roman, 2015. "Trade costs, conflicts, and defense spending," Journal of International Economics, Elsevier, vol. 95(2), pages 305-318.
    2. Garfinkel, Michelle R. & Syropoulos, Constantinos & Yotov, Yoto V., 2020. "Arming in the global economy: The importance of trade with enemies and friends," Journal of International Economics, Elsevier, vol. 123(C).
    3. Garfinkel, Michelle R. & Syropoulos, Constantinos & Zylkin, Thomas, 2022. "Prudence versus predation and the gains from trade," Journal of Economic Theory, Elsevier, vol. 201(C).
    4. Reuven Glick & Alan M. Taylor, 2010. "Collateral Damage: Trade Disruption and the Economic Impact of War," The Review of Economics and Statistics, MIT Press, vol. 92(1), pages 102-127, February.
    5. Michelle Garfinkel & Constantinos Syropoulos, 2025. "Trade Interdependence, Arming and the Choice between War and Peace," Working Papers 202511, Center for Global Policy Analysis, LeBow College of Business, Drexel University.
    6. Fearon, James D., 1995. "Rationalist explanations for war," International Organization, Cambridge University Press, vol. 49(3), pages 379-414, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Gains from trade; National security; Arming; War and peace;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D30 - Microeconomics - - Distribution - - - General
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • F10 - International Economics - - Trade - - - General
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • F60 - International Economics - - Economic Impacts of Globalization - - - General

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