How economic interdependence builds the peace that politics cannot.

There is a principle hiding in plain sight: countries that trade with each other rarely go to war with each other. A new essay from HumanProgress.org by Walker Wright walks through the evidence, and the underlying scholarship is more consistent than most public conversation about war and peace would suggest.

The research has moved from what scholars once called “democratic peace theory” toward what they now call “capitalist peace theory.” Trade openness and economic interdependence rank among the strongest forces that reduce the likelihood of interstate conflict. The mechanism matters: countries must actually trade with one another — not merely sign onto trade organizations — to capture the peace-building effect. Set global trade growth and the long decline in interstate war side by side and the relationship becomes hard to dismiss.

Frédéric Bastiat captured the mechanism two centuries ago: trade barriers “create isolation, isolation gives rise to hatred, hatred to war, war to invasion.” When you depend on someone as a customer or supplier, you have a powerful material reason to work things out. Economist Christopher Blattman puts it this way: economic interdependence does not eliminate every path to conflict, but “the gravitational pull of peace has grown stronger.”

This connects directly to two of Human Flourishing’s pillars: governance and economic freedom. Good governance creates the conditions for trade to function. Economic freedom puts those conditions to work, turning strangers into trading partners and trading partners into something closer to neighbors.

A Story Worth Telling

During my decade working with the Conscious Capitalism movement — both in Arizona and globally — I watched this principle operate in one of the world’s most contested relationships. Our chapter in Israel was doing what Conscious Capitalism chapters do: teaching the practices of purpose-driven, stakeholder-oriented business. What made the Israel chapter remarkable was who was in the room. Jewish entrepreneurs and Arab and Palestinian business owners, working alongside each other on the practical questions of building a good company.

The animosities that dominate the headlines were not absent from those people’s lives. They simply were not the center of gravity in that room. Commerce gave them a common language and a shared interest that no diplomatic framework had managed to produce.

Few outside the region realize how deep the economic ties between Arizona and Israel run. The connection is grounded in something concrete: both regions face arid climates and severe water constraints. That shared challenge has generated genuine cooperation — research partnerships, Israeli companies establishing operations here, and a quiet but durable relationship built on practical problem-solving.

That is what economic freedom looks like at the human level: people with real stakes in one another’s success.

Why the Recent Summit Matters

As economic and geopolitical tensions between the United States and China have risen, the recent summit between President Trump and President Xi deserves more attention than the news cycle is likely to give it.

The fact that the summit happened at all is significant. Two leaders of rival superpowers chose to meet rather than continue an escalating trajectory. Reasonable people will disagree about what was achieved and what it means, and that disagreement is healthy. The point worth holding onto is the simpler one: the gravitational pull Wright describes — the weight of mutual economic interest — exerts itself even between adversaries. The costs of severed economic ties are real, and governments on both sides have reason to reckon with that.

Trade does not guarantee peace. The evidence is that it makes peace more likely, and conflict more costly. Thomas Paine put it well in Rights of Man: commerce is “a pacific system, operating to unite mankind, by rendering nations, as well as individuals, useful to each other.”

When people are free to trade, to build, to exchange value across borders, we are doing more than growing prosperity. We are building the conditions under which human flourishing becomes possible for more people, in more places.

Read the full essay at HumanProgress.org → Make Trade, Not War: How Capitalism Creates Peace