Peace through Trade or Free Trade?

Abstract

This study argues that a subtle shift in the primary independent variable of the commercial peace literature—from trade to free trade—provides an opportunity to respond to the some of the strongest criticisms of this research program. Free trade, and not just trade, promotes peace by removing an important foundation of domestic privilege—protective barriers to international commerce—that enhances the domestic power of societal groups likely to support war, reduces the capacity of free-trading interests to limit aggression in foreign policy, and simultaneously generates political support for the state often used to build its war machine. A series of statistical tests demonstrates that higher levels of free trade, rather than trade alone, reduce military conflict between states. Moreover, contrary to conventional wisdom, these arguments suggest how the puzzling case of World War I may confirm, rather than contradict, the central claims of commercial liberalism.