Reassessing the Benefits of Trade Interdependency and Alliance Formation in Reducing International Conflict: Disaggregating Trade within Alliance Types
Placito, Thomas B.
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The importance of alliances and trade in maintaining stability and peace in the international system has been the subject of much debate among International Relations scholars for some time now. Advocates for peace through strong alliances dates back to the writings of Thucydides and realist scholars such as Morganthau (1948), and Waltz (1979). Proponents of the peace-through-trade hypothesis have argued that increasing aggregate levels of trade among states will produce a corresponding decrease in conflict initiation generally (Oneal & Russett, 2001), while others find limited, or no significant impact of trade on conflict when applying various methodological techniques and data (Barbieri, 1996; Beck, Katz & Tucker, 1998; Gleditsch, 2002). More recent research has shown that all trade is not the same and therefore, various commodities will have very different effects on conflict when it is disaggregated into either strategic or non-strategic sectors (Dorussen, 2006; Geonner, 2010; Reuveny, & Li, 2011). This study analyses the effects of several strategic sector commodities on the relationship between trade and conflict initiation within three alliances formations, (defensive, offensive, and neutral). I use bilateral trade flow data of six strategic commodity groups from the United Nations, collected by Feenstra (2005) at the NBER, and later compiled by Goenner, 2010 for 1962-2000. Following Goenner (2010), logit regressions of the effects of these commodities on conflict is shown to differ within the three alliance types than from samples using all dyads. The results show that, except for one strategic category (chemicals), trade interdependency in these commodities does not have any effect on changes in conflict levels within alliances. The findings here support the importance of modeling for the contextual environment between states along with any economic costs, when analyzing the heterogeneous nature of trade on conflict.