St. Louis Fed, Report: On the Economic Mechanics of Warfare

“Historians have argued that wars are often decided by attrition instead of “decisive” battles and genius-like generalship. Attrition, in turn, emphasizes the importance of resources in determining the outcomes of war. Hence, I use a model of resource attrition derived from combat models _a la Lanchester (1916) to represent war.”

“I consider military conclusions, where one side cannot fight anymore for lack of resources, and political conclusions, where one side does not fight anymore for lack of political will. Under each scenario, I describe how resources determine the duration of the war, the destruction and casualties, and the prevailing side.”

“Some interesting results are as follows: First, a country obtaining a military victory can shorten the war by allocating more resources to it and, thus, can reduce destruction and casualties for both sides. Second, higher GDP makes the condition for a military victory more favorable and the condition for suing for peace on political grounds less favorable. Finally, there is a well-defined cost-minimizing level of support from a third-party to a small country fighting a war against a larger country.”