Economic growth and interstate conflict: Growth as a catalyst for conflict

Extant theoretical and empirical work on economic growth and international militarized conflict presents contradictory explanations and findings. Theories dating back several decades link high economic growth to more frequent international conflict but generally rely on anecdotal evidence, while most recent empirical studies present evidence to the contrary. These latter studies find that low economic growth increases international conflict, yet most are limited to the American case. I build upon theories claiming that higher rates of economic growth should increase the probability of international conflict by focusing on the domestic politics of states. By contrast, I argue that economic growth increases social optimism and military capabilities, which provide states with the means and willingness to participate in militarized international conflicts. I argue that lower rates of economic growth should act as a constraint on state involvement in foreign conflicts, especially those that entail the highest risk of fatalities. During these times, domestic opposition could seek to exploit a leader's possible political vulnerability. Additionally, lower rates of economic growth should reduce military spending and military readiness. I then extend this study to search for possible strategic behavior in relation to the differential growth rates between two states: states may initiate militarized action based on their own growth rate as well as that of potential opponents. Hence, economic growth should affect when wars and other militarized disputes occur.; I test my theory on a cross-national sample of 56 countries from around the world from 1870--1992. The findings support my theory that countries that have sustained economic growth for several years are more likely to become involved in militarized international disputes, but this effect is particularly strong in regard to severe disputes such as wars. However, I also find that joint economic growth between two states may act as a pacifying or deterring effect. Finally, I find evidence suggesting that many studies of economic growth on the dyadic level of analysis (pairs of states) may suffer from selection bias resulting from missing data that may lead to incorrect inferences.