Abstract

http://ssrn.com/abstract=2389300
 


 



Networks of Military Alliances, Wars, and International Trade


Matthew O. Jackson


Stanford University - Department of Economics; Santa Fe Institute; Canadian Institute for Advanced Research (CIFAR)

Stephen Nei


Stanford University - Department of Economics

June 21, 2014


Abstract:     
We investigate the role of networks of military alliances in preventing or encouraging wars between groups of countries. A country is vulnerable to attack if some allied group of countries can defeat the defending country and its (remaining) allies based on their collective military strengths. We show that there do not exist any networks which contain no vulnerable countries and that are stable against the pairwise addition of a new alliance as well as against the unilateral deletion of any existing alliance. We then show that economic benefits from international trade provide incentives to form alliances in ways that restore stability and prevent wars, both by increasing the density of alliances so that countries are less vulnerable and by removing the incentives of countries to attack their allies. In closing, we examine historical data on interstate wars and trade, noting that a dramatic (more than ten-fold) drop in the rate of interstate wars since 1950 is paralleled by the advent of nuclear weapons and an unprecedented growth in trade over the same period, matched with a similar densification and stabilization of alliances, consistent with the model.

Number of Pages in PDF File: 44

Keywords: Alliances, Conflict, War, Networks, International Trade, Treaties

JEL Classification: D74, D85, F10

working papers series


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Date posted: February 2, 2014 ; Last revised: July 15, 2014

Suggested Citation

Jackson, Matthew O. and Nei, Stephen, Networks of Military Alliances, Wars, and International Trade (June 21, 2014). Available at SSRN: http://ssrn.com/abstract=2389300 or http://dx.doi.org/10.2139/ssrn.2389300

Contact Information

Matthew O. Jackson (Contact Author)
Stanford University - Department of Economics ( email )
Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States
1-650-723-3544 (Phone)
HOME PAGE: http://www.stanford.edu/~jacksonm
Santa Fe Institute
1399 Hyde Park Road
Santa Fe, NM 87501
United States
Canadian Institute for Advanced Research (CIFAR) ( email )
180 Dundas Street West, Suite 1400
Toronto, Ontario
Canada
Stephen Nei
Stanford University - Department of Economics ( email )
Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States
HOME PAGE: http://www.stanford.edu/~snei
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