News from Around the World

There are a number of reasons why economics appears to trump politics. The shift from statist mercantilism to high-tech capitalism has transformed the economics behind war. Markets generate economic opportunities that make war less desirable. Territorial aggrandizement no longer provides the best path to riches. Free-flowing capital markets and other aspects of globalization simultaneously draw nations together and raise the economic price of military conflict, because the political destabilization resulting from war deters profitable investment and trade. Moreover, sanctions, which interfere with economic prosperity, provides a coercive step short of war to achieve foreign policy ends.