Anger is the psychological instinct in human beings and the outcome of this anger is conflict. If this anger is controlled we may be able to build peace. Peace and Conflict are the two determining factors of each and every aspect of human society. Peace acts as a positive factor while conflict/disturbance acts as a negative factor because both are the opposite of each other. These are the two factors which decide that will an economy move on the path of progress or not.
Nowadays in Economics, the term Economic Development cannot be defined without incorporating the term of peace in it. An economy in which, if the growth rate of GDP is very high but people are not living a peaceful life, can not be considered as a developed economy. In other words, an economy suffering from conflict or any type of disturbance cannot achieve economic development.
Peace can be treated as an input (special input) for economic development because all types of innovations, the creation of new technology and discovery of new markets which are the key factors of economic growth and development are only possible in a peaceful economy where conflicts have no place. If the economy is suffering from conflicts, then definitely economy will be hindered from reaching on the path of progress.
The mere reduction of poverty, inequality, and unemployment cannot be treated as economic development but it also involves improvements in the quality of life. Here the quality of life in a broader sense means a peaceful and enjoyable life. Or in other words only in peace that prosperity can be achieved, poverty and unemployment problems can be solved. Therefore, an economy which has recorded highest levels of GDP growth rate, but now is in the situation of conflict or war will be slipped down on the scale of economic development because now people of this economy will not be able to live a happy and peaceful life. Moreover, internal and external business setups will also be badly affected.
Thus, economic development is interpreted as not only in more growth in economic well-being but also in terms of good quality of life which according to Prof. Amartya Sen, consists in “enlargement of opportunities for people and freedom of human choice”. Also according to UN-HDR (Human Development Report) of 1994, “Human beings are born with certain potential capabilities the purpose of development is to create an environment in which all people can expand their capabilities “. And of course, this environment is only peaceful environment not an environment of conflict, where capabilities are miscalculated and the result is destruction- opposite of economic development.
The Institute of Economics and Peace (IEP) in conjunction with the Economists for Peace and Security (EPS) have released an insightful study which assesses the impact of lost peace on the world economy at 7.2 trillion dollars annually. The analysis clearly reveals that peace has an economic value. In a peaceful economy, every sector of production gets an opportunity to get flourish at its peak. Therefore, peace and development have a strong positive relation, as the level of peace prevails development increases in an economy. Analysis using the Global Peace Index (GPI) strongly supports the condition that peace contributes to a country’s economic growth. The GPI is a comprehensive indicator of internal and external peacefulness. Peace has not only internal positive effects but it has a spill-over effect across national borders. So, if we want a prosperous world economy, global peace is the must. But unfortunately some economies are creating disturbances in some other economies in order to get economically more sound, but they forget the fact that like peace, conflicts have also spill-over effects across nations, which later effects them too. Therefore, to be on the scale of economic welfare create the conditions of peace all over the world, everyone will get the beneficial fruits of it.