This chapter marks the starting point of our investigation of actual policy solutions to tackle armed conflict. When a doctor has reached her diagnosis, she must then decide on the right medication to administer. Similarly, while economists started by studying the drivers of political violence, in recent years increasing efforts have been made to understand how to cut the Gordian knot of conflict. As argued in this chapter, a first-order factor is the institutional environment, and in particular the need to give a voice to all citizens and groups in society. Democracy is desirable, but without proper safeguards it can have a dark side and result in blood being spilt. Furthermore, the type of democracy and the provisions of sharing power between groups matter. Closer inspection of local-level power-sharing in Northern Ireland, the building of modern Switzerland after its civil war in 1847, the difficulties for current democratization in Iraq and the franchise extension during the British Age of Reform drive this discussion forward.

The starting point of this chapter is the observation that would-be dictators are abundant around the globe, but some succeed in setting up and sustaining a rebel army while others do not. As argued in this chapter, a key ingredient for rebel success and conflict longevity is funding. One source of financing is the stolen spoils of nature. Think, for example, of blood diamonds. Beyond this particular example, we also discuss in this chapter systematic evidence on how access to mineral rents triggers an escalation of fighting activities of armed groups. In addition to resource rents, it is foreign funding that results in prolonged conflict, and may lead to proxy wars between fighting factions supported by rival foreign powers. The destructive potential of these sources of funding is examined by drawing on examples and empirical evidence from Angola, the Democratic Republic of Congo and India.

This chapter discusses the impact of particular policies at the global level. It turns out that coordination and common standards can make a big difference. First, it is shown that the global traceability of minerals can cut rebel funding significantly. Next, the role of monitoring multinationals is highlighted. Notably, recent studies have pinpointed the importance of corporate social responsibility of mining firms, revealing that the best-run mineral extractors may have a beneficial impact on the local population, while poorly run firms yield disastrous outcomes. Further, given that wars tend to trigger a series of vicious cycles, there is a powerful case for facilitating refugee admission. It is discussed how a well-coordinated refugee policy can reduce violence perpetuation over future generations. Next, we investigate what role international trade can play for fostering peace and what harmful effects arms trade can entail. It is shown how arms-producing countries can – without bearing large economic costs – reduce the ability of bad regimes to attack their civilians. Finally, the importance of a rule-based international order and a well-managed green transition is highlighted.

This chapter stresses the importance of smart idealism, and outlines how global public opinion – and all of us – can play a crucial role. We cannot simply rely on our politicians to “do the right thing,” as either of the two components of smart idealism may be missing. Ideological bias may result in policies falling short of being smart or failing to be idealist, namely when politicians’ incentives are distorted. Electoral terms typically of four years result in a bias towards short-run policies (at the detriment of the lengthy, but crucial task of building peace), and often there are personal benefits for politician when cutting shady deals with despots. To get the incentives right, public pressure must ensure that the reelection chances of our politicians crucially depend on fostering peace at home and abroad. If voters care about this, then politicians will as well – whether out of intrinsic motivation or just to get reelected. As shown in this chapter, recent evidence highlights that scrutiny and attention from the world press and the public at large is a powerful rampart against repression.

The concluding chapter wraps up the various arguments and pieces of evidence presented in this book in favor of our peace formula. Overall, the first take-home message to be highlighted is the need for smart idealism – as neither the cold-hearted egotist nor the naïve idealist will be able to curb conflict. Secondly, it is again stressed which concrete policies are key to making a difference, creating a synthesis of the various points of the previous chapters. In particular, we emphasize the key role of a democratic voice, security warranties, promoting productive work, fostering trust and reconciliation, accelerating a well-managed green energy transition and stepping up international coordination across a variety of issues. The final point is that since we are all affected by conflict, we should all be part of the solution. It turns out that several studies have found that pressure from the public opinion matters, both in the implementation of policies and in preventing atrocities. There is a job to be done, so let us work together to make a change.

This chapter focuses on explaining the powerful logic of perilous promises and hidden information, as well as the dangers of low opportunity costs and attractive rents. We start out by explaining how in many circumstances peaceful bargaining succeeds in preventing hostilities – as the “peace dividend” creates a range of win–win bargaining solutions. Sadly, though, asymmetric information, commitment problems and political bias can lead to bargaining failure and the outbreak of war. Further, when the stakes of contest are high and opportunity costs low, the scope for peaceful bargaining shrinks. In particular, we show that being out of work and out of options makes somebody easy prey for rebel headhunters. This is exemplified by the dreadful consequences of bad harvests. Next, we examine the role of ethnic cleavages and how they tend to be exploited by divisive ethnic politics. Finally, the chapter discusses the curse of natural resources. Countries blessed with valuable soils tend to suffer from conflict, often leaving them poorer than countries lacking natural resources.

This chapter argues that building strong institutions and a productive economy in the aftermath of conflict is not enough and that rebuilding lost social capital and trust is of paramount importance. Intergroup trust matters deeply, as the same formal institutions can have divergent effects in different social structures and for different levels of social capital. Starting from the so-called contact hypothesis that fostering positive intergroup interaction builds trust, it is argued that reconciliation and the rebuilding of social trust are also part of the promising blend of propeace policies. A variety of empirical studies are discussed, ranging from reconciliation efforts in Rwanda and Sierra Leone to programs fostering intergroup contacts in Spain, Nigeria, India and Iraq. While we find that more intense group contacts deploy typically desirable effects, trying to achieve reconciliation by altering beliefs through media campaigns is a double-edged sword that involves a series of dangers. We conclude this chapter by stressing the key role of stepping up critical thinking.

As shown in this chapter, state capacity and security warranties are further key factors in the peace formula. In particular, besides certain institutional features, the overall strength of the state is a major determinant of political stability, as illustrated by examples and recent research on Iraq, Somalia, Niger and the origins of the Mafia in southern Italy. Drawing on cutting-edge studies, it is argued that being feared (by extremist groups) may be more important than being loved (by the population at large). In order to win the hearts and minds of the population, it is essential that first public safety is guaranteed and that basic services are delivered efficiently. This is easier said than done. It is shown that when foreign military aid aims at capacity building, it often backfires. In contrast, UN peacekeeping troops have been demonstrated to play a key role. We end this chapter by emphasizing the several domestic factors that can help the building of lasting state capacity, with a special emphasis on well-designed welfare programs such as Franklin D. Roosevelt’s New Deal.

This chapter starts off by explaining that we are in the midst of a critical historical juncture with a record number of wars and conflicts around the world, calling for urgent action. Next, we discuss in depth three common but disastrous misconceptions, namely that shady deals leaving autocrats in power can bring peace, that “buying” peace through simple cash transfers works, and that charm offensives and communication efforts suffice to do the job. Drawing on a number of examples, the book highlights the pitfalls of these common misconceptions before turning to success stories. Illustrated by examples of the successful postwar reconstruction of Germany and Japan, the fall of apartheid in South Africa and democratization of Uruguay, Chile and Peru, the chapter then formulates the key components of what is called the peace formula – a set of key policies that constitute crucial ingredients for a successful and lasting pacification process. Finally, it is stressed that to counter distorted incentives for peace we need smart idealism – pairing good intentions with evidence-based policy knowledge.

This chapter starts by delimiting the scope of the book and making clear that we focus on various types of domestic political violence but that international wars are touched upon as well. We clearly define these terms and provide examples that illustrate the differences between distinct forms of violence, before moving to a discussion of the costs that these forms of violence impose on society. Strikingly, some people believe that wars and conflicts are good business. They are not. This chapter shows that wars not only destroy millions of innocent lives, but they are also poison for the economy. In particular, wars may be lucrative for the few but disastrous for the many. The detriments of war are manifold and include human, economic and social costs. This is illustrated by a series of historical examples. Drawing on recent cost estimates, it is also shown that the costs of a given war spread well beyond the borders of the country at war, with continental if not worldwide consequences.

This chapter shows that violence today sows the seeds of future fighting through a series of vicious cycles. First, it is stressed that persistent poverty creates vicious cycles of deprivation and disputes. Namely, poverty provides the breeding ground for violence, as the lack of income and perspectives makes it relatively more appealing to join armed rebellion. This, in turn, further impoverishes the country. Secondly, wars tear apart the social fabric of society, which in turn hinders postconflict reconstruction. Put differently, hate and distrust in the aftermath of fighting often trigger revenge wars further down the road. The third vicious cycle studied concerns education, with low human capital fueling fighting and subsequent wars destroying schools. Last but not least, this chapter discusses the impact of war trauma on future crime propensity. These various vicious cycles are illustrated with the help of a series of historical examples, spanning Peru, Angola and Uganda to Sri Lanka, Tajikistan and Switzerland. This discussion highlights the crucial importance of fostering peace right now, which leads to a powerful peace multiplier.