The Trade and Conflict Debate: A Survey of Theory, Evidence and Future Research
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Reuveny Rafael: Indiana University
Peace Economics, Peace Science, and Public Policy, 2000, vol. 6, issue 1, 1-29
No one disputes that international trade is affected by economic variables. However, the effects of political variables on trade also are important. For countries in peace, political agendas can affect trade through protectionism, for example. Political interventions in trade between hostile nations can halt trade, although hostile countries sometimes continue to trade. Casual observations also bear out that trade itself is a potential source of political conflict or cooperation between nations. In spite of this, economists in large part have not studied the relationship between trade and political conflict or cooperation between nations. Krugman, for one, argues that "trade politics is primarily about conflicts of interest within rather than between nations (1995: 28)." Bergeijk (1994: Chapter 5) even suggests that many economists view political conflicts between nations as unworthy of formal analysis.
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