Does war destroy business? A review of empirical publications

• Published date: 01 February 2023
• Author: Imran Naseem,Saeed Akbar,Muhammad Tahir,Saima Imran
• Date: 01 February 2023
• DOI: http://doi.org/10.1002/pa.2849

RESEARCH ARTICLE

Does war destroy business? A review of empirical publications

Imran Naseem

1,2,3,4,5

| Saeed Akbar

6

| Muhammad Tahir

7

| Saima Imran

8

1

University of Liverpool Management School,

Liverpool, UK

2

Accounting and Finance, University of Hull,

Hull, UK

3

International Relations Department,

University of Peshawar, Peshawar, Pakistan

4

Management Sciences Islamabad, COMSATS

University, Islamabad, Pakistan

5

Department of Pakistan Studies and

International Relations, Abbottabad University

of Science and Technology, Abbottabad,

Pakistan

6

Accounting, Finance and Economics

Department, University of Bradford,

Bradford, UK

7

Department of Management Sciences,

COMSATS University Islamabad, Abbottabad,

Pakistan

8

MS Development Studies, COMSATS

University Islamabad, Abbottabad, Pakistan

Correspondence

Imran Naseem, University of Liverpool

Management School, Liverpool, UK.

Email: imran.naseem@liverpool.ac.uk

The study investigates the economic dimensions of war. It considers empirical litera-

ture through structure review to explore the different effects of war on businesses.

The scope of the study covers all geographical areas and studies dealing with any

respective event in the 20

th

and 21

st

centuries. However, the study caters for quality,

relevance, and recentness in publications. Hence, publications in 4*, 4, and 3 stars

journals that are placed in Association of Business Schools of UK Guidelines in 2015

are reviewed. The study with its extant literature presents an important realization

that against the stereo-typed opinion about war being devastating to businesses indi-

cates that war affects in various dimensions, that is, positive, negative, or even no

effects depending on the nature and place of business. Whereas businesses, in gen-

eral, may be negatively affected in wartime, businesses critical to war may get an

unprecedented boost. The study also indicates a dire need of developing a frame-

work for investigating this important relationship on sound footings.

KEYWORDS

business, economics, empirical, relationship, war

1|INTRODUCTION

Despite understanding its devastation on humans and all other forms

of life, human history is full of the menace of war. Humans, groups,

and nations often opt for war anticipating victory. The literature sheds

light on the socio-political, religious, ideological, constitutional, and

military consequences of war, yet the field of business still begs for

such attention. This calls for proper scrutiny highlighting the effects of

war on business. The studied literature presents different effects of

different wars on different businesses across the world, reflecting the

complexity in understanding this very important relationship. In some

studies, wars create devastating scenarios for businesses, yet other

findings reflect a boom in certain businesses, while there are also

studies that show no impact on business.

Different studies have posed different research questions about

this important relationship, such as whether African states are revert-

ing to the state-building techniques of early Europe in the post-cold

war era amidst a better understanding of the historic economic

motives of war (Reno, 2002). Pratt (1934), rebutting the desire for a

strong industrial and financial base for American imperial expansion as

the underpinning cause of the US–Spain war, questions why financial

and business interests opposed the war. Even in 2002, the need to

study the relationship between war and business was highlighted by

Orts (2002), suggesting more rigorous efforts to materialize universal

peace and economic affluence. The US history of war seems to con-

cern the redistribution of wealth, which has been cited as the real

result of war in that country (Wright, 1943). Booth (1982) disagrees

that the outcomes of war could bring about improvement in health

and income redistribution, stating that the war model is too complex

to be an agent of socio-economic change. While the state-making

influence of war is largely acknowledged, its impact on the economy

(taxation-related aspects) is less researched (Kiser & Linton, 2001).

The costs of the two world warsto Germany and Austria-Hungary

in terms of the lossof life and property destructionhint at the potential

benefits of peaceful growth (Mendershausen, 1941). Factors like the

accumulationof wealth, innovation in technology, and productivityalso

Higher Education Commission of Pakistan funded this research.

Received: 4 October 2022 Revised: 8 November 2022 Accepted: 10 November 2022

DOI: 10.1002/pa.2849

J Public Affairs. 2023;23:e2849. wileyonlinelibrary.com/journal/pa © 2023 John Wiley & Sons Ltd. 1of24

https://doi.org/10.1002/pa.2849

call for a greater investigation of the market forces and government

policies in determining agricultural prices during and after the

war (Madden, 1963). Sanín (2008) observes that non-state military

groups are notnecessarily similar in strategy,and therefore, the Colum-

bian conflicts question the primary constituent of the early

political-economic war. Hence, uncertainty prevails as to whether war

accelerates major dominant economic developments. There is a need

to perform a cost–benefit analysis of the economics, including a com-

parison of the economic values of the new and old markets and the

degree of stress and disruption necessaryto accelerate inventions and

innovations(Simmons, 1981).

These contradictions in the literature reflect the gray area con-

cerning the economic perspective of war. This study aims to examine

the literature through a structured review to identify any effects of

war on business from different aspects. The scope of the study geo-

graphically covers the whole world, and it also encapsulates the

effects of war on any kind of business. Any relevant publications in

the 20

th

and 21

st

centuries that meet the study's criteria of quality,

relevance, and recentness are reviewed. Although the literature has

explored different and opposing effects of war on various businesses,

including the positive and negative effects, the lack of any effects, the

presence of war profiteers, or wartimes ethics, it lacks any developed

mechanism to investigate the complicated and vibrant relationship

between these two variables.

The current study produces an important realization against the

stereotyped opinion of war as being entirely devastating for busi-

nesses, thereby highlighting different wartime scenarios that are more

suitable for certain businesses. The study structurally reviews differ-

ent studies published in high-quality journals listed in the Association

of Business Schools UK Guidelines of 2015. The study starts with a

methodology section and is followed by sections including “Business

Profiting From War,”“Business Suffering due to War,”“War Having

No Effects on Business,”“War Profiteers,”“Ethical Considerations,”

and “Conclusion.”

1.1 |Methodology

Due to the dispersed nature of the available empirical literature, the

study opts for a structured review (Iqbal et al., 2015), with some

exemptions. Evidence in the existing literature documents that the

structured review is an appropriate research methodology for gauging

scattered literature rather than following the traditional “narrative”

review, which lacks comprehensiveness and falls short of genuine

investigatory science (Tranfield et al., 2003). Therefore, the study uses

quality, relevance, and recentness as benchmarks for potential litera-

ture. It selects reputed journals listed in the Academic Journal Quality

Guide of Association of Business Schools (ABS) 2015 and Social Sci-

ence Citation Indexed (SSCI), instead of searching through databases

(Claus & Briscoe, 2009; De Menezes & Kelliher, 2011). It screens titles

from a total of 22 area categories in the guide and finds only five rele-

vant categories for the initial search: (1) Business History and Eco-

nomic History, (2) General Management, Ethics and Social

Responsibility, (3) International Business and Area Studies, (4) Social

Sciences, and (5) Strategy (see the Column Journal Category in

Table 1).

The study only surveys journals with 4*, 4, and 3-star rankings,

and excludes journals with only 1- and 2-star rankings, in these 5 cate-

gories. Based on the relevancy of their titles, it selects 39 out of

73 journals for further search, producing 2 (4* stars), 7 (4 stars), and

30 (3 stars) journals (see Columns J# and AJG 2015 in Table 1). Using

the advanced search options on the homepage of each selected jour-

nal, the study extracts desired literature based on pre-determined

search phrases. Initially “War and Business”is used as the primary

search term and the titles of the articles of the first 20 pages of results

for each journal are examined, covering over 4485 studies. A total of

160 studies are selected as their titles show potential relevance (see

Column Searched Papers in Table 1). This also includes a few excep-

tions, as can be seen in Column Ex# in Table 1, bringing the number

of sources to 57 (see the count in Columns SJ# and Ex# in Table 1).

The Column Searched Papers in Table 1indicates the number of stud-

ies selected from each journal in the different categories.

The updated list includes three additional categories from the

respective guides, that is, Management Development and Education,

Operations and Technology Management, and Organization Studies.

The study adds a new category of Non-ABS sources, which further

comprises journals, book chapters, and reports. Now, it has 4 (4* star),

8 (4 stars), and 31 (3 stars) journals, except for 3 (2 stars), 2 (1 star),

and 6 (non-abs) journals and two report documents and a book chap-

ter (see Column Journal Category in Table 1). While “Risk Analysis: An

International Journal”is a 4-star journal, all other filtered journals fall

in the 3-star category (see Column AJG 15 in Table 1). Among the fil-

tered 160 studies, 54 are empirical. Of these 54 studies, 21 are

dropped at the second stage and 2 more are dropped at the analysis

stage, reducing the number to 31.

In the second step, based on availability, the abstracts of these

papers are skimmed to obtain a better understanding of the respec-

tive substance. Contrarily, the conclusions or introductions of the

papers are read if the abstracts are not available. Column “Selected

Papers”of Table 1indicates a reduction in the number of studies for

further analysis to 97. Similarly, a probe in the studies finds 33 empiri-

cal articles (see a count of Column Empirical Papers in Table 1).

Table 2indicates the spread of these 97 studies over 39 journals. Six

more studies are dropped at the analysis stage, which reduces the

number of studies to 91 and that of journals to 33. The dropped and

empirical papers are also indicated in Table 2. Table 3shows the

details of 97 studies. It also indicates 6 studies that are dropped at the

analysis stage, further reducing the number of studies to 91.

Table 4highlights the selected 97 studies and their geographic

and chronological spread. While 12 studies do not target any specific

countries, 25 studies are international in scope. Most country-specific

research (29 studies) is conducted in the United States and the

United Kingdom, with 5 studies marking a huge gap between the two.

This seems logical owing to the varying degrees of their respective

interests and involvement in world affairs. Likewise, the study sug-

gests that most studies emerged in the new millennium, that is, in the

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