8. Peer reviewed quantitative data shows that while the economy generally doesn’t produce diversionary war unemployment specifically does

(Benjamin, PoliSci@Albany The Politics of Threat Perception and the Use of Force: A Political Economy Model of U.S. Uses of Force, 1949-1994 International Studies Quarterly (1998) 42, 567-590)

An overwhelming amount of research indicates that economic conditions are politically important, and may influence the outcomes of elections (Alesina and Rosenthal, 1989; Chappell and Keech, 1985; Erikson, 1989; Fair, 1978; Hibbs, 1977, 1987; MacKuen, Erikson, and Stimson, 1992). By causing public dissatisfac- tion with the incumbent political leadership, poor economic performance may make a use of force to divert public attention or increase the salience of foreign policy issues more attractive. At the same time, though, the use of force may be more costly when the economy is performing poorly in certain ways, since the risk of war may worsen inflation, further depress the performance of financial markets, and raise the prospect of costly international commitments that are more difficult to finance in hard times than during more prosperous periods. Most previous analyses of the use of force have used a "misery index" of inflation and economic growth, usually weighted by the proportion of the public citing economic issues as the most important facing the country, to indicate economic performance (Ostrom andJob, 1986;James and Oneal, 1991 ;James and Hristoulas, 1993; Meernik, 1994; DeRouen, 1995; Meernik and Waterman, 1996). High inflation and high unemployment have similar demand effects because they both increase the attractiveness of a diversionary use of force. However, these conditions have different supply effects. High unemployment makes the use of force less costly by reducing labor costs if war or some other long-term international commitment results. (Indeed, the cynical might point out that war has historically been a highly effective jobs program.) On the other hand, high inflation increases the cost of using force because war tends to make this condition even worse. In the models presented here, the effects of inflation and unemployment are considered separately. Since only unemployment has complementary supply and demand effects on the use of force, only this variable should be significant over time. Blechman and Kaplan (1978:26-32) used the S&P 500 index of stock prices, discounted for inflation and real growth, as an indicator of "national confidence," representing a "buoyancy in the national spirit and a more optimistic view of the future." They found that this index was related to the annual number of uses of force. Unfortunately, Blechman and Kaplan did not adequately develop a theoreti- cal argument about the role of this variable. It is not clear that confidence and optimism should produce a greater tendency to use force in international relations. One could just as easily argue that a confident and optimistic nation will believe it can resolve its international disputes without resorting to military intimidation or the use of force. Perhaps because the meaning and implications of the concept are unclear, the notion of national confidence is rarely mentioned in the subsequent literature. In spite of the relationship Blechman and Kaplan found, the discounted S&P 500 index is rarely used in empirical research on the use of force.