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A Trade Institution as a Peaceful Institution?

  • Raul Caruso

    (Università Cattolica del Sacro Cuore di Milano)

Recent studies emphasize the occurrence of conflict as a rational economic activity as well as production and exchange. Agents are assumed to divide their efforts into fighting and productive activities, or as commonly denoted in ^Qguns^R and ^Qbutter^R. This paper does try to go beyond this ^Qmanichean^R idea assuming the Boulding^Rs concept of ^Qintegrative system^R. In particular, the paper investigates whether a trade institution committed to free and fair trade could foster ^Qpeaceful^R benefits for member countries. The analysis, produced in a very simplified world, counts as a founding pillar the Contest Success Function. The results of the model suggest that in an institutionalized scenario agents gain more both in terms of economic utility and in terms of peace than in ^Qcontinuing conflict^R and ^Qobstructed trade^R scenarios.

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Paper provided by EconWPA in its series Others with number 0406003.

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Length: 38 pages
Date of creation: 12 Jun 2004
Date of revision: 15 Dec 2004
Handle: RePEc:wpa:wuwpot:0406003
Note: Type of Document - pdf; pages: 38
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  1. Charles H. Anderton, 2003. "Conflict and Trade in a Predator/Prey Economy," Review of Development Economics, Wiley Blackwell, vol. 7(1), pages 15-29, February.
  2. Charles H. Anderton, 2000. "An Insecure Economy under Ratio and Logistic Conflict Technologies," Journal of Conflict Resolution, Peace Science Society (International), vol. 44(6), pages 823-838, December.
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