Trade and conflict: The dyad of Greece and Turkey

Archontis L. Pantsios


The conflict-trade paradigm has been dominated by the liberal and realist schools of thought, which try to explain how and why trade affects conflict and cooperation. While the liberal point of view predicts a positive effect of levels of trade on cooperation, realists counter by arguing a negative or negligible effect at best. The article presents the basic theoretical arguments and extensions of the conflict-trade relation as espoused by the liberal school of thought and applies them to the Greco- Turkish dyad. Foreign policy conclusions are drawn from a Greek point of view, and are related to trade volume, type of trade, state of democratization, country size, contiguity, tariffs, foreign aid, and third-party effects. With few qualifications, it is shown that it would serve Greece's best interests and promote peace in the region if Turkey were to become a full member of the European Union.

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