Neoclassical Economics and War: Unifying the Liberal Peace Hypotheses.

Challenging some of the common explanations for the liberal peace, I argue that the principles of classical liberal theory can be merged with the insights of neo institutional economics to construct a single conceptual framework capable of generating numerous liberal hypotheses linking democracy, international commerce, capitalism, and variations in the forms of wealth to the outbreak of peace between states. Building on such simple principles as the law of demand, monopoly behavior, and diminishing returns, I move beyond democracy to integrate previously neglected domestic institutions also capable of shaping foreign policy, grand strategy, and the outbreak of war. As society establishes more institutional safeguards that protect individual liberties and limit a government’s authority, the state should be less likely to participate in war. [ABSTRACT FROM AUTHOR]