Please note that prior to May 2019, the Stanford King Center on Global Development was known as the Stanford Center on Global Poverty and Development.
In a new working paper, Center faculty affiliate Saumitra Jha and Moses Shayo of Hebrew University found that giving Israelis a short, intensive opportunity to trade stocks made them much more willing to negotiate with the Palestinians. Involvement in the stock market made Israelis less likely to vote for harder-line, right-wing parties, especially Prime Minister Benjamin Netanyahu’s incumbent Likud party; more supportive of a two-state solution, and more willing to make concessions in exchange for peace. And the effects lasted: A full year later, the changes in people’s voting preferences persisted.
Jha and Shayo hypothesized that one way that commerce, and financial markets in particular, can reduce conflict is by making people more aware of the broader economic costs of war — costs they may not have otherwise noticed.