Peace is a term of our lexicon that has been a part of the discourse vis-a-vis our mind, between communities, within nations, and across boundaries. It is defined as a concept of societal camaraderie in the absence of hostility and violence. We’re well acquainted with the ironic word ‘peace-keeping forces’ which entail and propagate the use of force and coercion to maintain the virtue of peace, which should come naturally to us otherwise. Correlation between peace and other disciplines like political science, psychology, geography, cognitive science, anthropology and sociology is prevalent. However, little do we know that there is a strong nexus between peace and economics. They are central to each other and act as catalysts in each other’s process.

Let’s start from the beginning. The austerity of the post-Second World War world isn’t unknown to us. The cost of human lives and their intangible grief is a deep loss that can neither be redressed nor measured using a statistical tool. Talking in monetary terms, the governments of both the axis and allied forces lost about $1 trillion in a war. Here comes the importance of peace and peace enabling structures from a financial point of view as well.

There exists a discipline that acts as a bridge between development and harmony. ‘Peace Economics’ is a specialised division of economics. It focuses on the creation of the landscape’s political, economic, and cultural institutions and aims at preventing, alleviating, and reconciling the violent conflict between and within societies using relevant policies. Violent conflict can both be latent or active. Peace Economics talks about the benefits of rebuilding and restoring societies based on our presumed knowledge of the cost of violence. Peace Economics has a sweeping view of attaining stable and irrevocable peace. The use of economics here is to comprehend the causes and the repercussions of hostility thereafter in the international system.

Another definition of the subject has been furnished by Jan Tinbergen, a Nobel prize winner in Economics. As per his scrutiny economic science is made use of to preclude war. It is used as an instrument to settle the disputes among nations and design a world order where warfare is punished. It encircles the concept of negative peace which is a word coined by Johan Galtung that equals the absence of aggression and not the presence of peace. To throw a little more light on this through a simple question, does the absence of poverty in a nation necessarily indicate the presence of opulence? A major exclusion from these definitions is the reference to international relations and no mention of civil war or violence at the individual level.

There is a recognition that Peace Economics forms a part of both positive and normative economics. For those who are alien to these rather heavy-sounding terms, the former simply studies economic phenomena with the ‘what is’ backdrop, that is with facts and figures of the current situation. Whereas the latter as the name suggests covers the ‘what ought to be’ perspective by furnishing corrective recommendations and solutions. Contemporary economists prefer positive economics to evaluate the policies as they are and give relevant suggestions thereafter. On the other hand, normative economics sets the ‘norm’ for peace and then looks for systems that help realise this norm.

Sustainable economic growth can’t be achieved without peace and peace is at risk without sustainable economic growth. The above quip safely interlaces the two subjects. When governments, for instance, make sure to eradicate youth radicalisation by investing in labour-intensive public projects, it leads to full and efficient utilisation of potential, thereby assuring their operation as resources on the Production Possibility Curve (PPC) and not inside it. They become an asset for their countries.

Quoting an example of trade here. A free trade zone is created and a treaty signed not just with the goal of bettering bilateral or multilateral relations but also facilitating the promotion of peace. The trail of this link can be traced from the 19th century, a classic case of the English Tory rebels. A modern-day illustration of the same is the South Asian Free Trade Area which ensures non-belligerent relations in the region and promises peace.

Dating back to 1914, during the First World War there was a peace conference held in Paris. A book titled The Economic Consequences of the Peace by John Maynard Keynes came into being and stated how the terms of the allies regarding truce were financially impossible to achieve for Germany and how those acted as a stimulant in encouraging them to stand steadfast, again. Keynes’ theory also very explicitly mentioned the high rise in employment being conducive to peace.

Crunching some numbers and putting facts into the picture, the global economy is liable to pay more than $14 trillion a year owing to conflict according to the World Economic Forum. The breakdown includes spending on the military, internal security, conflict losses, and crime. India, to be specific, forfeited 9% of its GDP due to friction in 2018. It was on the 136th rank in the Global Peace Index out of 163 nations. Down at the bottom was the war-torn Syria which had to lose a massive 68% of its GDP. Iceland is at the top of this list. Another intriguing certitude is that the countries which are placed higher on the Global Peace Index have observed trends of per capita GDP growing thrice as fast as those which are not as peaceful.

It is important for international organisations like the World Bank and the International Monetary Fund (IMF) to bolster the presence of an infrastructure that ameliorates the livelihoods of those indulged in any sort of clash. Governments need to take affirmative actions with peacebuilding attempts at the core, philanthropists and businesses should contribute and comply with the directives. An instance of the same from the new world order is of Colombia. Over 100 companies in the country marched forward towards peace by coupling their own advertising with the national peace campaign.

A crucial reform would be to ensure domestic violence between intimate partners, workplace violence and even self-harm forms the nucleus of present-day research for peace studies. This will go a long way in delivering positive solutions and will make resorting to violence inconceivable. The Institute for Economics and Peace, a think tank is developing a yardstick to analyse peace and quantify its economic value. This will act as a concrete step in laying a firm association between peace and prosperity. Let’s hope for a world in which this theme is self-explanatory and doesn’t have to be this persuasive. Let’s live for the day when world peace isn’t a pipe dream anymore.