This literature review examines the impact of conflict on developing economies, drawing from nine key sources available in the field. The sources span various periods and perspectives, offering a comprehensive view of how war affects economic growth, wealth distribution, defence spending, child labour, and food aid. In reviewing these texts, I have synthesised insights on how conflicts disrupt economic mechanisms and reshape policy responses within both domestic and international contexts.
My understanding of the literature reveals that wars are among the most significant contributors to human suffering and underdevelopment, particularly in poorer countries. These readings delve into the ways in which wars influence economic conditions, highlighting the role of political institutions, governance quality, and international actors in the process of post-war rebuilding. By critically engaging with the texts, I have linked the empirical views of post-conflict recovery to the cultural, political, and economic factors that shape outcomes in various nations.
A central theme across the sources is the examination of the macro- and micro-level economic consequences of war, including both the direct costs of military operations and the indirect human costs. The sources explore the complexities of policy interventions, defence spending, and international aid in mitigating or exacerbating these costs. In analysing these nine works, I aim to provide an overview that integrates differing viewpoints on how wars, especially civil conflicts, have uniquely disruptive effects on the social and economic systems of developing nations. This review represents my synthesis of the existing literature, offering a broad perspective on the economic ramifications of conflict and the potential pathways toward recovery.
Wars are among the most significant causes of human suffering, misery, and underdevelopment. Yet, economic analyses of countries at war remain relatively rare. This review aims to address this gap by synthesising insights from nine key sources that trace the economic and social consequences of war, both theoretically and empirically, using various case studies discussed in the literature. The review provides a general framework for understanding the political economy of war-torn countries and summarises an empirical overview of the costs of conflict for developing nations.
A multidisciplinary approach is essential, as the sources combine political and sociological analyses to help understand motivations and behaviours during conflict, while economic analysis is used to evaluate the impact on populations. This literature review draws on these works to examine how the international system influences war economics and identifies international and domestic policies that could mitigate the human and economic costs of conflict.
The reviewed literature highlights the prevalence of wars in poorer countries, emphasising that between 1950 and 1990, approximately 15 million deaths were caused directly or indirectly by wars in developing countries. The end of the Cold War led to peace in many regions where conflict had been fuelled by East-West confrontation, but new wars erupted. According to these sources, between 1989 and 1995, 34 to 51 armed conflicts broke out each year, predominantly in poor, developing countries.
The literature further investigates the economic and social consequences at both macro and micro levels, aiming to identify indirect human and economic costs alongside the direct costs of military operations. It explores the main economic mechanisms during war and the policy responses of governments and international actors, illustrating how each can intensify conflict costs. The sources show that variations in responses and resulting costs point to policy approaches that could reduce the human and economic impact, even before peace is achieved.
Defence spending is another focal point across the literature, regarded as a crucial component of government expenditure in both developed and less developed countries. The reviewed texts reveal that recent political and economic developments have influenced the nature of defence, affecting global military expenditure. They underscore the need to reassess traditional attitudes towards defence spending in the context of conflict and economic growth.
The literature addresses the effects of defence spending on economic growth in developing countries, investigating whether increased defence spending accelerates economic growth in developed nations while hampering prosperity in less developed countries. This examination emphasises the importance of careful policy considerations during transition periods, particularly for economists, historians, and political scientists studying defence spending’s nature and implications.
Additionally, the sources raise questions about the interactions between economic policy and peace-building. While there is extensive debate in the literature on structural adjustment, the works suggest that other fundamental factors may require more research, especially in post-conflict countries. This indicates that governments may need to prioritise issues beyond conventional economic reforms during rebuilding efforts.
Finally, this review summarises findings from the sources regarding the economic and social costs of civil conflicts over the past 40 years, focusing on internal conflicts in poorer countries. The literature identifies internal conflicts as more disruptive to economic and social systems than international conflicts. However, the sources also highlight the challenges in distinguishing internal conflicts from international ones, as foreign countries often play significant roles in these disputes.
Since 1945, the literature notes that numerous intrastate conflicts have occurred in countries that gained independence after World War II. The trajectory and quality of national development in these countries have been profoundly affected by conflict, domestic political institutions, governance quality, and geopolitical dynamics in the developing world.
Conclusion
This literature review has examined the multifaceted impact of war on economic development in developing countries, drawing on insights from nine key sources. The literature highlights that wars are significant contributors to human suffering and economic disruption, affecting growth, wealth distribution, defence spending, and overall development. Both macro- and micro-level analyses reveal the direct costs of military operations and the indirect human and economic consequences that can persist long after conflicts end.
A key theme across the sources is the complexity of policy responses. While increased defence spending can stimulate growth in developed nations, it often hampers prosperity in less developed countries. The literature also questions the priority of traditional economic reforms in post-conflict recovery, suggesting that policymakers must consider more fundamental socio-political variables to foster effective rebuilding.
In summary, the economic impact of war extends beyond immediate destruction, requiring a holistic approach to recovery that includes governance, international aid, and economic policy. Future research should continue to explore these intricate relationships to develop strategies that address both the economic and socio-political challenges faced by war-affected nations.
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