The liberal peace: challenges to development, democracy and soft power

The term liberal peace is employed to explain the absence of fatal conflict between democratic nations that are also economically interdependent. The expression, liberal peace, therefore, has an economic dimension, as well as an element based on a common polity and sets of values. I sketch the ideal and economic versions of the liberal peace theory. Policies promoting globalization may engender a backlash social conflict risks, as they produce inequality. In developed countries we witness the rise of populism, and the rolling back of the liberal aspects of democracy in developing countries. The avoidance of these problems require careful management of policies such that growth is broad-based, and policies promoting greater openness are sufficiently cushioned to protect losers. It is also necessary to manage globalization, and limit its negative impact on domestic social contracts, particularly when it comes to inequality, labour rights and fiscal austerity.