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Who wins wars?

Author

Listed:
  • Federle, Jonathan-Julian
  • Rohner, Dominic
  • Schularick, Moritz

Abstract

Economic resources are often seen as decisive for the outcomes of military conflicts. This paper asks whether "deeper pockets" help win wars. We construct a fine-grained dataset covering more than 700 interstate disputes and rely on exogenous resource price shocks to estimate the causal effect of windfall gains on winning chances in interstate conflicts. We find a statistically significant and quantitatively large impact of windfall gains on winning odds and show that a key channel of transmission is a surge in military spending, after an exogenous increase in government revenues.

Suggested Citation

  • Federle, Jonathan-Julian & Rohner, Dominic & Schularick, Moritz, 2025. "Who wins wars?," Kiel Working Papers 2280, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:310329
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    More about this item

    Keywords

    Interstate disputes; International wars; Commodity prices; Conflict outcomes; Military expenditures;
    All these keywords.

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative
    • Q02 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Commodity Market

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