War, Trade and Natural Resources: A Historical Perspective

War and Trade are two human activities that are so intrinsic to the species that it is impossible to assign any moment in its evolution at which either of them first " appeared ". Every stage of socio-political evolution, from hunting and gathering to agriculture and animal husbandry and on to the commercial and industrial nations of today, has seen people conducting trade and warfare, both within their own boundaries and across them. The object of both Trade and War, or " Warre " as Thomas Hobbes more emphatically labeled it, has for most of the time been access to and control over scarce " Natural Resources " , differing only in the means by which this is to be achieved. Trade attempts to secure access to the fruits of the natural resources possessed by others by offering something of value in return, frequently the products obtained from the different bundle of natural resources in one's own possession, thereby making both parties " better off ". War, on the other hand, attempts to do this by using force to deprive the other of the resources at his command, without offering anything of value in return. The use of force, however, itself requires the input of the user's own scarce resources. Thus both War and Trade, from this perspective, are but alternative options to convert one's own scarce resources into those of the other in a manner that enhances one's own welfare, the difference being that Trade also raises the welfare of the other while War reduces it. Which option will be taken, at any given moment, and to what extent, will of course depend upon the circumstances and the preferences of the agents with regard to the benefits, costs and risks involved. War and Trade can also be mutually supportive of each other in a rational calculus of statecraft such as that of the seventeenth century Mercantilists with their twin objectives of Power and Plenty, as so lucidly explained by Jacob Viner (1948) in his classic article. Here the state deploys force, or the threat of it, to create markets for final products and to secure sources of raw materials, thereby raising national output and revenue which in turn enhances the level of force that can be sustained. 2 Lionel Robbins famously defined economics as the study of the relationship between ends and scarce means that have alternative uses. This …