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Communal violence requires a prior existence of radicalism. The chapter shows that the degree of extremism of one group can increase or decrease in response to that of the other. Lootable wealth unambiguously raises radicalism. It is not the absolute level of income but the difference between peacetime income and that of conflict periods that determines the magnitude of radicalism.

Raul Caruso, educated in Naples, Leuven and Milan, is currently senior researcher at the Institute of Economic Policy, Università Cattolica del Sacro Cuore (Italy) where he is also serving as adjunct professor of international economics. He is also visiting professor at Warsaw University (Poland). He has also been visiting professor at Massachusetts Institute of Technology (MIT) (USA), Hiroshima University (Japan), Kazakh Humanitarian Law University (Kazakhstan) and Novosibirsk State University (Russian Federation). His main research interests are peace economics, international political economy, economics of crime and sport economics. He has published on contest theory, sport economics, economic interpretation of terrorism, economic causes of wars and international economic sanctions. He is the executive coordinator of Network of European Peace Scientists (NEPS). He is also editor in chief of Peace Economics, Peace Science and Public Policy.

The study of war and peace is nowadays becoming a complex topic drawing from different disciplines and applying different methodologies. This book collects 10 studies on conflict and its pernicious consequences. The appropriate scientific field for this set of studies is the peace economics as defined in Isard (1994), Arrow (1995) and Caruso (2010). In particular, Peace Economics is a sub-field of Peace Science and it is generally concerned with (1) the economic determinants of actual and potential conflicts; (2) the impact of conflict on welfare and on the economic behaviour of societies; (3) the use of economic measures to cope with and control conflicts whether economic or not. Central to this field are analyses of conflicts amongst nations, regions and other communities of the world; measures to control (deescalate) arms races and achieve reduction in military expenditures; programmes and policies to utilize resources thus released for more constructive purposes. Put briefly, the main object of peace economics is the study of conflict and conflict resolution in different forms. In particular, the contents of this book are mainly on the positive ‘side’ of Peace Economics, which emphasizes the study of conflict and its consequences. In particular, in the recent years, a growing economic literature has uncovered both the economic determinants and consequences of actual intra-state conflicts. This book is intended to be a contribution to this literature. It gathers both theoretical and empirical contributions.

The prolonged army rule in the country has affected the policymaking procedure of the state. Specifically, defence and foreign policies of the country are normally decided by the armed forces of Pakistan as per their own priorities, which is against the norms of democratic culture and supremacy of the civilian rule.

The control of important decision-making process in the hands of the armed forces has generated an arms race in the subcontinent. The major portion of the national budget is being spent on the defence forces and other sectors such as education and health and social welfare are not getting their due share from the revenue of the country. The continued sense of insecurity and animosity with neighbour countries, especially India, has resulted in speeding the acquisition of sophisticated arms in the country.

This research discusses the effects of the military's role in the decision-making of the country and its impacts on the relations between India and Pakistan. The confidence building measures and peacemaking process in South Asia is dependent on the attitude of the military of both the countries.