Slowly debunking the trade leads to peace fallacy

In 2010 I wrote that economic issues are just another factor in decisions on war or peace. There is nothing to suggest that free trade leads to peace per se (The Liberal Divide over Trade, Peace, and War, International Relations, vol 24, number 2, June 2010).

This is not a particular popular viewpoint, certainly not among classical liberals and libertarians, for reasons written about before at this blog.

So it is nice to read in Dale C. Copeland’s new book Economic Interdependence and War (Princeton University Press 2015), that indeed it all depends upon the situation. Economic factors can just as easily be cause for war, as a cause for refraining from violence. Copeland does not write from the liberal tradition, but if he had, he could have used Adam Smith, David Hume or Friedrich Hayek in support for his argument.

Anyway, the good thing is that the free-trade -leads-to-peace thesis is slowly but surely being debunked. It makes for a better and more mature discussion about international relations, inside and outside liberalism.

4 thoughts on “Slowly debunking the trade leads to peace fallacy

  1. I took maybe eight courses on political science as an undergraduate, and my readings mostly consisted of the latest journal articles and books (rather than textbooks) written by scholars at the top of their field. In addition, my interest in political science was mostly in trade, political economy, and IR, so many of the articles I was exposed to were written by economists as well as political scientists. I’m not exactly an expert.

    Here’s the thing, though: In those few courses I don’t recall ever running into the trade-leads-to-peace thesis. Like, ever.

    Trade can lead to peace, so I’m not sure labeling the trade-leads-to-peace argument (the one that I’ve never seen) a “fallacy” is entirely correct.

    My guess – and this is only a guess – is that you’re aiming at libertarians and classical liberals who make this argument. Yet in the interest of fairness, most of your targets are inevitably Americans, and there is probably a strong case that trade does lead to peace from their vantage. (A hegemon’s trade with a junior partner is going to be viewed differently by both sides involved, right? From an American viewpoint, trade leads to peace, but from, say, an Indian viewpoint, trade with the US could lead to a dependence of sorts. I am only writing of viewpoints, which are much more erratic than empirical evidence coupled with sound theory.)

    Here is how trade is treated in the political science texts I came across: It increases wealth. This is also how many, or most, libertarians also view trade. Given the trade-off between becoming wealthier or becoming potential rivals (a la Germany and the UK circa 1914), I know where I stand. No amount of moral posturing in the name of a “national interest” could possibly excuse a policy that deliberately keeps a population poorer than it otherwise could be. This is the standard libertarian argument in favor of free trade.

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