Exploring the Economic Context of Peace Using game Theory

Abstract

Due to the phenomenon of globalization, investors today pay more attention than ever to investing in its global concept. On the other hand, scholars in the field of international relations, especially in the liberal tradition, emphasize the impact of international economic cooperation, such as trade and investment, on the spread of peace and the prevention of war. Accordingly, the present article, while referring to objective examples of international relations, has tried to provide a different answer to the important question of "economic cooperation in the form of international investment while maximizing" by using "game theory". "Investor interests should also prevent war and the development of peace." By presenting a static game between players, the article models the behavior between investors and countries according to the possible strategies for each player. In this regard, first, a situation is considered in which the two countries are indifferent to each other. Then in the second case, two countries are considered to be rivals (enemies) and in the third case, three countries are assumed, one of which is a rival and the other is indifferent. Given the equilibrium obtained in all three cases, the overall result indicates that the investment achieves the best result (Nash equilibrium) by forming portfolios in different markets and the country at home by creating interaction and peace. The results of the research in the language of logic (mathematics) confirm the effect of economic cooperation on the development of peace, where through the development of international investment, governments achieve peace and on the other hand, investors achieve the best results.

Keywords

• international investment
• peace
• game theory
• nash equilibrium