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New School Economic Review, Volume 2(1), 2007, 38-48
PEACE ECONOMICS: PRIVATE SECTOR BUSINESS
INVOLVEMENT IN CONFLICT PREVENTION
Katharina Felgenhauer
ABSTRACT
Conflict prevention has escaped pure state responsibility and needs to involve a
wide range of societal actors, including business. The private sector, especially
multinational corporations, can powerfully contribute to comprehensive peace
building and derive profit from doing so. However, profit-oriented behavior can
also endanger peace, unless the economic incentive structure induces conflict
preventing business strategies. Yet, such ideal scenario requires commitment
from the state, the civil society and the companies themselves.
I INTRODUCTION
Our world has long moved beyond the Westphalian system of international relations;
matters of peace and war have evolved as well. Currently the civil population plays a
more important role as actors, instruments, and victims (Nelson 2000). Congruently,
conflict prevention and peace-making escaped pure state responsibility and need to
address society as a whole through involving a wide range of interdependent actors.
Peace, it appears, can only be sustained if carried by maj orities among all stakeholders
and mainstreamed within all parts of society.
In order to attain sustainable peace traditional first-track diplomacy of formal
governmental negotiation must be complemented by the inclusion of various social
actors. John McDonald and Louise Diamond elaborate further distinctions of diplomatic
efforts emerging within the civil society, among them track three: the involvement of
business through private sector economic activities aimed at preventing conflicts
(Diamo
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