WAR SEEMS TO BENEFIT EVERYONE (EXCEPT THE ONES WHO DIE FIGHTING IN IT) – PATRIOTS, POLITICIANS, ARMS INDUSTRY, PROFITEERS. CAN THERE BE AN ECONOMIC JUSTIFICATION OF A WAR? CAN, AND SHOULD, ECONOMIC DECISIONS BE MADE IN MORAL VACUUM?

1. EFFECTS OF WAR
BY
KUNAL ANAND
BACHELOR IN BUSINESS ECONOMICS
2ND YEAR (4TH SEMESTER)
An Integrated Assignment
Submitted in Partial Fulfillment of the Requirements for the
BACHELOR IN BUSINESS ECONOMICS
Department of Economics
St. Xavier’s College of Management & Technology, Patna
MAY, 2019

2. War seems to benefit everyone (except the ones who die fighting in it) – patriots,
politicians, arms industry, profiteers. Can there be an economic justification of a
war? Can, and should, economic decisions be made in moral vacuum?

3. Introduction
The use of violence and force between two or more sate to resolve a matter of dispute is
known as war. A war generally involves the use of weapons, a military organization and
soldiers. There is no any benefits from war.
Kargil war (1999)
The Kargil War, also known as the Kargil conflict,(I) signifies an armed
conflict between India and Pakistan that took place between May and July 1999 in
the Kargil district of Kashmir. According to Pakistan 1600 Indian army died in the
war where India claimed 527. Pakistan says that it lost 357–453 army. India says
that more than 700 died in the battle. Army of both country are died there is no gain
from war in both country.
Region of war :
There is rarely one single, clear cause of conflict and, ultimately, war. The causes of
a war are usually numerous, and several reasons for a conflict can be intertwined in
a complicated way.
1. Economic Gain
2. Religion
3. Nationalism
4. Revenge
5. Defensive War
Economic gain - Often wars are caused by one country's wish to take control of
another country's wealth. Whatever the other reasons for a war may be, there is
almost always an economic motive underlying most conflicts, even if the stated aim
of the war is presented to the public. In modern times, the resources that are hoped

4. to be gained from war take the form of things like oil, minerals, or materials used in
manufacturing. In pre-industrial times, the gains desired by a warring country might
be precious materials such as gold and silver, or livestock such as cattle and horses.
Religion - Religious wars can often be tied to other reasons for conflict, such as
nationalism or revenge for a perceived historical slight in the past. While different
religions fighting against each other can be a cause of war, different sects within a
religion (for example, Protestant and Catholic, or Sunni and Shiite)
Nationalism - Nationalism in this context essentially means attempting to prove
that your country is superior to another by violent subjugation for Example: World
War I
Revenge - Seeking to punish, redress a grievance, or simply strike back for a
perceived slight can often be a factor in the waging of war. Revenge also relates to
nationalism, as the people of a country which has been wronged are motivated to
fight back by pride and spirit. For example: World War II, war on terror.
Defensive War - the modern world, where military aggression is more widely
questioned, countries will often argue that they are fighting in a purely defensive
capacity against an aggressor, or potential aggressor, and that their war is therefore
a “just” war for example: cold war
Negative impact of War:
 Government will focus more on war less on people.
 All the Taxpayer’s money will be used for Arms and ammunition.
 Chaos at all the grocery stores and shopping malls.
 Rupee will fall to lowest in years.

5. Government will focus more on war less on people - When a conflict leads to
higher governmental expenditures, the population financing the war is either paying
directly (and immediately) or indirectly (and maybe delayed). Hence, war finance is
can be divided into two categories: Direct or indirect financing. The former
comprises taxes through which the population bears directly the burden, the latter
includes borrowing or increasing the money supply.
All the Taxpayer’s money will be used for Arms and ammunition - Except
from the productivity point of view, the different finance methods have various
effects. For the taxation method of financing, we can focus on the political point
of view. As people know that increasing the taxation would make them poorer,
and enables them to consume and invest less, they probably won't be willing to
pay such taxes
Chaos at all the grocery stores and shopping malls - At the time of war
producer can’t produce that much amount of goods & services because lack of
money and heavy taxes.
Rupee will fall to lowest in years – At the time of war the value of currency
fall. The external value of the domestic currency depreciates while the internal
value remains the same, such situation is known as the devaluation of the
domestic currency.
Profiteer Company from War
War is good for few and bad for most. Every occurrence that happens in this
world, there is always a gain or a loss. War is an inclusive event that involves
some organizations profiting from it on a very high level. Organizations that
profit from war are called war profiteer, they profit from warfare, and also from
the sales of weapons and other related goods to parties during a war.

6. I. Raytheon ($1.9 billion)weapon company
II. BAE Systems($2.6 billion) weapon company
III. Hugo boss ( $262,183,000) uniform company
IV. Roche ($46.8 billion) pharma company
Benefits Of War :
A. Politicians :
Politicians use the concept of war to increase their vote banks.
Politician uses the sentiments of people. Politicians promises in their manifesto
that if their government comes they spend more money for defence and if the
war is happening then the country will reply bravely and diplomatically
B. Arms industries:
Arms industries is a global industry which manufactures
and sells weapons and military technology. It consists of a commercial
industry involved in the research and development, engineering,
production, and servicing of military material, equipment, and facilities. If
the war is happening, then the both countries needs the arms and the
demand of the arms and ammunition is high and then there is increase in
production of arms industries and if the increase in arms industries then the
arms and ammunition also increased.
Effect of war:
1. On the economy:
Many circumstances, war can lead to inflation – which leads
to loss of people’s savings, rise in uncertainty and loss of confidence in the
financial system. For example, in the US civil war, the Confederacy struggled
financially to meet the cost of the war. Therefore, they started printing
money to pay soldiers salaries. But, as they printed money, the value of
money soon declined. High inflation hits middle-income savers the most as
they see the value of their savings wiped out.

7. 2. On the society :
Most wars have resulted in a significant loss of life. Conflict
characterizes a major obstacle for the Development. Obstacle for
development are like displacement of people or forced migration results
most often during a time of war and adversely affect both the community
and an individual. When a war breaks out, many people leaving their homes
in fear of losing their lives and their families, and as a result, they become
misplaced either internally or externally. when a country is in an economic
crisis there is an increase in poverty which results in the decline of
education. In the case of Iraq, boys were pulled out of school to work for
their families, and therefore the education gap for men and women shrank.
The effect of war is for long time interval and there is mass killing.
3. On the environment:
Military activity has significant impacts on the environment.
Not only can war be destructive to the social environment, but military
activities produce extensive amounts of greenhouse gases which cause
global warming and climate change. Military campaigns require large
quantities of explosive weapons, a fraction of which will not detonate
properly and leave unexploded weapons.
This creates a serious physical and chemical hazard for the
civilian populations living in areas which were once war zones, due to the
possibility of detonation after the conflict, as well as the leaching of
chemicals into the soil and groundwater
war is not justified because of its aftermath, war causes death,
destruction, loss and suffering one of the result of war is the loss of innocent
people, destroying their homeland and making people live in constant fear
of being attacked. Fighting in name of bringing peace cannot be justified

8. because it contradicts the meaning of peace itself. The most common
argument is that war is acceptable when it is in self-defense.
If war can save more people than killing them, then war can be
justified. Looking back at the two major war that is First World War and
Second World War that is long for four years more than 40 countries
participated in the war and both war resulted over 37 million causalities
with properties is damaged. Scholars justify war using the principle of
utilitarianism; they believe that war will improve the lives of many people,
however, in reality; many innocent citizens are the ones who die. Most
people go to war to win not to lose. Therefore, they will use all the lethal
weapons like bombs that will affect innocent people like in the case of
Hiroshima and Nagasaki. The outcome of any war is destruction that
includes people, habitat, infrastructure, livelihoods, and relationships. We
should all know that human lives are too precious to be measured by
personal agendas.
If we cannot prevent wars, we do not have the morals to justify war
itself. I do believe that war is not justified at all and it is not necessary.
Nobody has the right to kill people in the name of restoring peace or
protecting its citizens from potential threat.

9. Conclusion
War has detrimental effects on society. Although war may financially
benefit a country and stimulate the economy, it has detrimental effects
on politics, economics and society. War also include mass destruction of
cities and have long lasting effects on a country's economy. Armed
conflict have important indirect negative consequences on,
infrastructure, public health provision, and social order.
Therefore, war is not justified at all and nobody has
the right to kill the people in the name of restoring peace or protecting it
citizen from potential threat. War decision is last option. War has also
psychological effect Death, injury, sexual violence, malnutrition, illness,
and disability are some of the most threatening physical consequences
of war, depression and anxiety are some of the emotional effects. War is
good for few and bad for many.

10. References
I. https://s3.amazonaws.com/academia.edu.documents/37084533/Airpo
wer_at_18_000__The_Indian_Air_Force_in_the_Kargil_War_-
_Carnegie_Endowment_for_International_Peace.pdf?AWSAccessKe
yId=AKIAIWOWYYGZ2Y53UL3A&Expires=1555251146&Signat
ure=KmQ6lAx9w7h%2FsrrC5LQ0X8wEt1M%3D&response-
content-
disposition=inline%3B%20filename%3DAirpower_at_18_000_The_
Indian_Air_Force.pdf
II. http://www.milsf.com/types-of-war/
III. https://www.marketwatch.com/story/cheaper-bacon-and-pricier-
electronics-how-trade-war-with-china-impacts-you-2018-04-04
IV. https://en.wikipedia.org/wiki/Outline_of_war#History_of_war
V. https://en.wikipedia.org/wiki/Companies_by_arms_sales