The role of market forces in transnational violence.

Author:Seita, Alex Y.
Position::Conceptualizing Violence: Present and Future Developments in International Law

The idea of a free market has been one of the most influential and successful in history. According to many, it is one of the three fundamental characteristics that define the industrialized democracies--along with representative democracy and the protection of human right.(1) In a free market, government interference is minimized, and private parties such as producers and consumers make the key decisions in determining what commodities are made and sold.(2) Instead of government bureaucrats, market forces--the pressures produced by supply and demand (created by the desire of sellers to sell and buyers to buy, respectively)--generate prices for and determine the available quantity of market commodities.(3)

Today, the process of globalization has expanded the perimeters of a marketplace beyond national boundaries for many commodities (usually goods, but sometimes services). For commodities such as sound recordings, movies, computer hardware and software, motor vehicles, clothing, and agricultural products, there is essentially a global market.(4) While not quite global, the market for other commodities may be transnational, involving at least two countries. Transnational and global markets often arise when manufacturers of products target customers in several countries, allowing buyers a choice of products imported from a number of countries. With the lowering of trade barriers and the release of market forces, original sellers and ultimate buyers can be located in different countries, and market commodities (or their components) can move across national boundaries through the efforts of intermediate market participants. Part I of this Article will discuss the way in which market forces such as supply and demand can lead to transnational violence. This section also includes examples of the effects of market-driven violence on various parties and explains why a completely effective solution to such violence is unlikely to materialize. In Part II, the author analyzes types of markets and how competition and the globalization of markets inure to the benefit of individuals and society as a whole. Problems associated with globalization will also be discussed. Finally, Part III proposes methods by which international violence may be combatted, including international agreements concerning market forces and the utilization of nongovernmental organizations.


    The unleashing of market forces beyond national dimensions, while providing economic benefits, has also had an impact on transnational violence--violence which has roots or effects in more than one country.(5) Transnational market forces, pressures of supply and demand operating or having effects across national boundaries, can have a causal link to some types of transnational violence. Such violence may affect market participants, third-parties and the market commodity itself because violence is part of the commodity purchased.

    Historically, there have been numerous examples of transnational violence caused by economic factors, where countries fought for economic gain or to protect their economic interests.(6) The New World conquest by Spain and other European nations was based, in part, on the perceived riches of America--its gold and other natural resources.(7) Likewise, Great Britain fought China in the Opium War of 1840-42 because China tried to restrict the opium sales of British merchants.(8) Lastly, there is the contemporary example of Iraq's invasion of Kuwait in 1990 to acquire Kuwaiti oil.(9) But these are examples of violence generated because governments and national leaders coveted economic gain, not from market forces where private parties--corporate and individual sellers and buyers--interacted with each other. While market-driven violence, such as slavery, was more national than transnational in the past, it sometimes had international dimensions.(10) Today, market-driven violence, like markets in general, has become more transnational.

    We are all familiar with typical market commodities such as televisions, breakfast cereals, and airplanes. Like these typical commodities, the "commodity" that is associated with violence ("violence commodities") has its price and output determined though the pressures of supply and demand.(11) Illegal or not, the demand for (and supply of) particular market commodities can often be a contributing cause of violence, whether narrowly defined to mean death or serious physical injury to human beings, or broadly defined to include psychological harm to human beings and physical harm to other living organisms and the environment.

    Violence can be inflicted by market participants upon other market participants or upon third-parties having no connection to the market. Violence occurs because those who demand or supply a product frequently practice violence in order to satiate their demand or protect their supply. On the demand side, buyers may use violence to obtain the money to buy the commodity (e.g., drug users commit robberies for money to buy drugs). On the supply side, violence may be used to protect, obtain, or distribute the commodity.(12) For example, marijuana and coca growers may use violence to protect their plants; drug dealers may shoot innocent bystanders as well as competitors while protecting market share; miners may drive off indigenous people in order to acquire gold from their lands; fishermen catching tuna may use fishing techniques that simultaneously kill dolphins; sellers of rare animals (whether living or parts thereof) will cause the death of endangered species.(13)

    Violence can also arise from the commodity itself, because the commodity is often used to commit violence or because the consumption of the commodity inherently involves violence. First, the market commodity can be used as an instrument of violence against persons, property or things. For example, land mines maim and kill thousands of civilians each year.(14) Second, the commodity itself may be the subject of violence. For instance, when the "commodity" of child prostitution is consumed, children are raped.(15)

    All of these examples of market-driven violence have harmful externalities--third-party effects of a market transaction that do not affect market participants.(16) The costs to third-parties are not incorporated in the prices of market commodities and thus are not borne by buyers and sellers. For example, using deep-sea drift nets may be an efficient way to catch tuna (the market commodity), but it also kills dolphins. Killing dolphins is an objective of neither the fishing companies nor consumer buyers. The dolphins just get in the way of efficient fishing techniques, and dead dolphins can be ignored because they are not a cost to the sellers. This is like the old, and now infrequent (at least in the industrialized democracies), example of polluted waters and lands, where producers could pollute at no cost while making their products.(17) In other words, the social cost of dead dolphins is not reflected in the price of tuna.(18)

    Transnational market forces are more difficult to control than domestic market forces because enforcement mechanisms are either lacking or ineffective.(19) All other things being equal, it is easier for a government to erect barriers to keep drug suppliers out of a market when the suppliers are local rather than foreign, or to prevent child prostitution from reaching customers when the customers are local. Foreign sellers or buyers, however, may lie outside a single country's power, preventing a country from restricting the supply of or reducing the demand for commodities that are a cause of transnational violence.(20) The lack of extraterritorial enforcement by one country is an indication that governments acting by themselves have limited power.(21)

    The obvious solution would be an international agreement to regulate market participants. An effective agreement, however, may never materialize due to a number of interconnected factors. First, an international consensus for an agreement may be lacking because countries might have different value judgments and legal perspectives.(22) Specifically, countries (or various constituencies within these countries) may place different value judgments or priorities on market commodities linked to transnational violence. The population of one country may see a harmless sale, whereas another may see a sale that has harmful externalities. Because one country may tolerate prostitution (including child prostitution), foreign buyers may find a ready market for sex and the addition of wealthy foreign buyers in addition to local buyers will increase the demand for prostitution.

    If the tolerance of the supplying country is matched by the indifference of the buying country to the behavior of its nationals overseas, then there are no market restrictions and a free market in prostitution will exist. A country's tolerance of its nationals' appetite for endangered species or rain forest products may draw in imports of such commodities even where the supplying countries prohibit these sales.(23)

    Second, the probability of an agreement may be low if it is costly to restrict market forces and some countries are unwilling to incur such costs. A host country may permit foreign companies within its national boundaries to employ children, who may suffer abusive working conditions and occasional violence,(24) if it judges the overall benefits of child labor to be greater than its costs. The prohibition of child labor may eliminate not only tax revenues for the government and a better economy for the country, but also jobs for children who may have less attractive alternatives to employment. Furthermore, in the market for child prostitution, a host country (the destination of tourists) may tolerate foreign sex tourists as a necessary evil accompanying a lucrative tourism industry, and home countries (the home of tourists) may not...

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