War, Peace, and the Invisible Hand: Positive Political Externalities of Economic Globalization ERIKGARTZKE

Studies of signaling in international relations reveal how punishing bluffing ex post through domestic audience costs or opposition groups facilitates credible ex ante communication among states and reduces the impetus toward war. Global integration of economic markets may also reduce uncertainty by making talk costly ex ante. Autonomous global capital can respond dramatically to political crises. To the degree that globalization forces leaders to choose between pursuing competitive political goals and maintaining economic stability, it reveals the intensity of leaders ’ preferences, reducing the need for military contests as a method of identifying mutually acceptable bargains. Asymmetric integration can dampen the pacific effects of globalization, but asymmetry does not in itself exacerbate dispute behavior. We present the theory and offer preliminary corroborative tests of implications of the argument on postwar militarized disputes. He intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was not part of his intention. FAdam Smith (1976, p. 477) Certain bourgeois writers y give the hope of peace among nations under capitalism. Theoretically, this opinion is absurd, while in practice it is sophistry and a dishonest defense of the worst opportunism. FV. I. Lenin (1970[1916], p. 74