Globalization and wartime trade

Bibliographic Data

ID8911201
AuthorsTal Sadeh (0000-0002-9416-7906, corresponding author), Nizan Feldman (0000-0002-9635-6516)
Year2020
Volume55
Issue2
Pages235-260
Publication date2020-01-06
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueCooperation and Conflict (JOURNAL)
Journal identifiersISSN: 0010-8367 • E-ISSN: 1460-3691
PublisherSAGE Publishing (PUBLISHER • US)
DOI10.1177/0010836719896613
OpenAlexW3000581776
LanguageEN
Citations received6
References cited61

This article argues that on balance globalization does not increase, and may even reduce, the opportunity cost of Militarized Interstate Disputes (MIDs), as measured by foregone merchandise trade. Specifically, globalization makes it easier for states to substitute trade partners, makes it difficult to employ trade sanctions, makes credit more available to states at conflict, and encourages trade-substituting horizontal Foreign Direct Investment (FDI) and sanctions-resilient vertical FDI. Hypotheses are supported using High Dimensional Fixed Effects regression, applied to a Gravity model, with two-way clustering of standard errors, and an analysis of the effect of globalization on the marginal effect of MIDs on international trade. This suggests that while wars are becoming infrequent in recent decades, due to other factors, trade’s contribution to peace is diminishing

Balance of trade · Economic sanctions · Economics · Foreign direct investment · Globalization · Gravity model of trade · International economics · International trade · Investment (military · Macroeconomics · Market economy · Political science · Politics · Sanctions · Trade barrier · Economic Sanctions and International Relations · Global trade and economics · International Development and Aid

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