and productivity growth is low. We apply our theory to the windfalls of Norway, Iraq and Ghana. The optimal size of Ghana …’s liquidity fund is tiny even with high prudence. Norway’s liquidity fund is bigger than Ghana’s. Iraq’s liquidity fund is …

states and growing divergence between European powers. In our model, the impact of war on the European state system depends … on: i) the importance of money for determining the war outcome (which stands for the cost of war), and ii) a country … of war. Initially, this caused more internally cohesive states to invest more in state capacity, while other (more …

Contestants have to choose whether to initiate a contest or war, or whether to remain peaceful for another period. We …

This paper analyses theoretically and empirically the relationship between trade and war. We show that the intuition … that trade promotes peace is only partially true even in a model where trade is beneficial to all, war reduces trade and … leaders take into account the costs of war. When war can occur because of the presence of asymmetric information, the …

Existing theories of pre-emptive war typically predict that the leading country may choose to launch a war on a … was Japan who launched a war against the West in 1941, not the West that pre-emptively attacked Japan. Similarly, many … have argued that trade makes war less likely, yet World War I erupted at a time of unprecedented globalization. This paper …

.S., we compare this bias between U.S. Cold War (CW) allies to non-CW allies, before and after the CW ended. The results show …