1. www.economicsandpeace.org Steve Killelea Chairman, Institute for Economics and Peace 3 rd November 2010 ISTAT, Rome

2. www.economicsandpeace.org The Institute for Economics and Peace

3. www.economicsandpeace.org What Does IEP Do? Policy Promote and inform public debate with a view to impact public policy by providing an accessible and high quality forum for discussion through debates, seminars, lectures, dialogues and conferences. Education Present educators with solid empirical data to further study the impacts of peace on economies. Stimulate the study of the issues by others, and help draw the work of those in related fields. Analysis Lead research and rigorous theoretical and empirical analysis around the economies of peace and the Peace Industry. Collaborate with experts internationally. Consulting Develop strategic expertise in the area of peace economics, and conduct client sponsored research for commercial businesses, foundations and other organizations. E-publishing Publish research results and policy recommendations widely and freely, including annual release of the Global Peace Index.

4. www.economicsandpeace.org The Global Peace Index

5. www.economicsandpeace.org Motivation for focus on Peace Major challenge facing humanity is sustainability Challenges are global, urgent and require unparalleled co-operation Peace is the prerequisite for solving these problems

6. www.economicsandpeace.org Why an Index? Never been done before Peace is poorly understood Peace should and can be measured Through measuring peace its texture can be analysed

7. www.economicsandpeace.org Global Coverage Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Peru, Trinidad and Tobago, Uruguay, Venezuela Albania, Armenia, Austria, Azerbaijan, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, Ireland, Italy, Kazakhstan, Latvia, Lithuania, Luxembourg, Macedonia, Moldova, Montenegro, Netherlands, Norway, Poland, Portugal, Romania, Russia, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turkey, Turkmenistan, Ukraine, United Kingdom, Uzbekistan Canada, United States of America Afghanistan, Australia, Bangladesh, Bhutan, Cambodia, China, India, Indonesia, Japan, Laos, Malaysia, Mongolia, Myanmar, Nepal, New Zealand, North Korea, Pakistan, Papua New Guinea, Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, Vietnam Algeria, Angola, Bahrain, Botswana, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Congo (Brazzaville), Cote d' Ivoire, Democratic Republic of the Congo, Egypt, Equatorial Guinea, Ethiopia, Gabon, Gambia, Ghana, Iran, Iraq, Israel, Jordan, Kenya, Kuwait, Lebanon, Liberia, Libya, Madagascar, Malawi, Mali, Mauritania, Morocco, Mozambique, Namibia, Nigeria, Oman, Qatar, Rwanda, Saudi Arabia, Senegal, Sierra Leone, Somalia, South Africa, Sudan, Swaziland, Syria, Tanzania, Tunisia, Uganda, United Arab Emirates, Yemen, Zambia, Zimbabwe

8. www.economicsandpeace.org Defining Peace Peace is more than the absence of war. The perfect state would have no police, jails or crime Defined peace as the “Absence of Violence” This definition allows for measurements of both internal and external peacefulness “Positive Peace” is uncovered via statistical analysis with other data sets, indexes and attitudinal surveys

9. www.economicsandpeace.org 23 Indicators 5 measures of ongoing conflict such as: number of conflicts fought 2003-2008 and number of deaths from organised conflict 10 measures of societal safety and security including: number of displaced people, potential for terrorist acts, number of homicides, number of jailed population 8 measures of militarisation such as: military expenditure, number of armed service personnel, ease of access to small weapons Visits to www.visionofhumanity.org doubled since last year Weighted on a 1-5 scale Overall score weighted 60% for internal peace and 40% for external peace

10. www.economicsandpeace.org 23 Indicators Uses both quantitative and qualitative indicators Sourced from highly respected organisations Estimated by EIU analysts where data is missing Weighted on a 1-5 scale Overall score weighted 60% for internal peace and 40% for external peace

11. www.economicsandpeace.org 23 Indicators weightindicator 4Perceptions of criminality in society 3Number of internal security officers and police 100,000 people 4Number of homicides per 100,000 people 3Number of jailed population per 100,000 people 3Ease of access to weapons of minor destruction 5Level of organized conflict (internal) 3Likelihood of violent demonstrations 4Level of violent crime 4Political instability 4Respect for human rights 2 Volume of transfers of major conventional weapons, as recipient (Imports) per 100,000 people

12. www.economicsandpeace.org 23 Indicators weightindicator 1Potential for terrorist acts 5Number of deaths from organized conflict (internal) 2Military expenditure as a percentage of GDP 2Number of armed services personnel per 100,000 people 2Financial support to UN Peacekeeping missions 3Aggregate number of heavy weapons per 100,000 people 3 Volume of transfers of major conventional weapons as supplier (exports) per 100,000 people 2Military capability/sophistication 4Number of displaced people as a percentage of the population 5Relations with neighboring countries 5Number of external and internal conflicts fought 5Estimated number of deaths from organized conflict (external)

13. www.economicsandpeace.org The Index has been endorsed by hundreds of individuals and organizations, including Nobel Laureates, government officials, renowned academics and business leaders. They include: HH Dalai Lama; Kofi Annan; Archbishop Desmond Tutu; President Martti Ahtisaari; Betty Williams; Muhammad Yunus; Amnesty International; President Jimmy Carter; Professor Joseph Stiglitz; Sir Mark Moody-Stuart; Her Majesty Queen Noor of Jordan; His Royal Highness Prince El Hassan bin Talal of Jordan; Sir Richard Branson and Ted Turner Global Support

14. www.economicsandpeace.org Partners and Uses Inclusion in SIPRI Yearbook Case Study for Cranfield University Inclusion in World Bank data sets and website Inclusion in OECD website Partnership with Aspen Institute to promote research outputs Used in the Ibrahim Index of African Governance Used in Building Blocks of Peace education curricula of IEP Inclusion in UNDP Users Guide to Measuring Fragility and Conflict Inclusion in UN University materials for studies worldwide Foundation for Global Symposium of Peaceful Nations Inclusion in Inter-American Development Bank governance indicators database

15. www.economicsandpeace.org GPI Methodology

16. www.economicsandpeace.org Defining Peace  Absence of war or conflict  If the country is not involved in violent conflicts with neighbouring states or suffering internal wars it has achieved a state of peace NEGATIVE PEACE  A more complete evaluation of peace should account for the conditions which are favourable to its emergence  Freedom, human rights and justice are included POSITIVE PEACECULTURE OF PEACE  The UN has defined a culture of peace as one involving values, attitudes and behaviours that:  reject violence,  prevent conflicts by addressing root causes  solve problems through dialogue and negotiation

17. www.economicsandpeace.org and measuring it Two objectives  scoring model  index ranking 149 nations across 23 indicators  correlate and statistically analyze data sets, attitudinal surveys and indexes to identify potential determinants of peace Measures Outcome Methodologically sound and unbiased measurement of peace. Provides the raw material for a worldwide debate on peace Rank the nations of the world by their relative states of peace and facilitate cross- country comparisons Quantify and measure the importance and possible causality of a range of potential drivers that may create peaceful societies

18. www.economicsandpeace.org Methodology Improved year on year Comparative data available for 2007 to 2010 2010 improvements: Heavy Weapons - Sought expert opinion from SIPRI – now sourced form Military Balance (IISS) and the UN Register of Conventional Arms - Categories weighed by destructive capability Displaced Persons - Previously only refugees counted - IDP’s data sourced form Internal Displacement Monitoring Centre

19. www.economicsandpeace.org GPI 2010 Results

20. www.economicsandpeace.org The Results

21. www.economicsandpeace.org The Results The 10 Most Peaceful Countries RankCountryScore 1New Zealand1.188 2Iceland1.212 3Japan1.247 4Austria1.290 5Norway1.322 6Ireland1.337 7Denmark1.341 7Luxembourg1.341 9Finland1.352 10Sweden1.354

22. www.economicsandpeace.org The Results The 10 Least Peaceful Countries RankCountryScore 149Iraq3.406 148Somalia3.390 147Afghanistan3.252 146Sudan3.125 145Pakistan3.050 144Israel3.019 143Russia3.013 142Georgia2.970 141Chad2.964 140DRC2.925

23. www.economicsandpeace.org A Less Peaceful World? Majority of the 23 indicators that constitute the index have risen, indicating an overall decline in the level of peace The most marked increases in the sum of scores have been in: The number of homicides per 100,000 people The likelihood of violent demonstrations The potential for terrorist attacks Most of the overall increases in these three indicators were confined to relatively few countries Political instability has also increased slightly across the world. This proved to be the most influenced indicator – changes were registered in just over 60% of the countries The most marked decreases in aggregate scores have been in: The measure of the respect for human rights – slight improvement overall Estimated number of deaths from organized conflict (external)

24. www.economicsandpeace.org The Study of Peace CountryScore, 2010Ch. In score, 2009-10Rank, 2010Ch. In rank 2009-10 Ethiopia2.444-0.107127+6 Mauritania2.389-0.088123+6 Hungary1.495-0.08020+7 Lebanon2.639-0.078134+3 Haiti2.270-0.060114+7 Top 5 Fallers CountryScore, 2010Ch. In score, 2009-10Rank, 2010Ch. In rank 2009-10 Cyprus2.0130.27676-25 Russia3.0130.264143-2 Philippines2.5740.247130-10 Georgia2.9700.234142-3 Syria2.2740.225115-18 Top 5 Risers

25. www.economicsandpeace.org Risers and Fallers Since 2009 Top 5 Risers -0.107 Ethiopia Change in rank: +6 Sharp drop in the number of Ethiopian fatalities resulting from external conflict. Decrease in military expenditure as a % of GDP. Improved assessment of the respect for human rights. -0.088 Mauritania Change in rank: +6 Fall in the assessment of internal conflict and violent demonstrations. Improvement in relations with neighbouring countries. -0.080 Hungary Change in rank: +7 Drop in latest published data on homicide rates. Improved assessment of the respect of human rights. -0.078 Lebanon Change in rank: +3 Fall in the perceptions of criminality in society. Falls in the level of organised conflict and violent demonstrations. Increase in political stability and assessment of the respect for human rights. Decrease in the number of deaths from internal conflict. -0.060 Haiti Change in rank: +7 Reduction in violent demonstrations and greater respect for human rights. Drop in the number of fatalities from internal conflict.

26. www.economicsandpeace.org Risers and Fallers Since 2009 Top 5 Fallers +0.276 Cyprus Change in rank: -25 Changes to our measurement methodologies for two series, aggregate number of heavy weaponry and refugees (now includes internally displaced people) are the major contributors to change. +0.264 Russia Change in rank: -2 Increase in violent demonstrations and political instability. Increase in measure of heavy weaponry. Increase in number of deaths from external conflicts. +0.247 Philippines Change in rank: -10 Increase in the perceptions of criminality in society. Increases in the latest data for the homicide rate and proportion of people in jail. Increase in the number of deaths from internal conflict. +0.234 Georgia Change in rank: -3 Increase in violent demonstrations. Decrease in political stability. Increases in military expenditure as a % of GDP and imports of weaponry. Increase in conflict indicator and number of displaced people. +0.225 Syria Change in rank: -18 Changes to our measurement methodologies for aggregate number of heavy weaponry a major contributor to the deterioration in the peace score. Also, fall in respect for human rights and increases in homicides and displaced people.

27. www.economicsandpeace.org The Results Geography and Key Attributes Ranking states of peace 1. Small, politically stable, democratic countries top the ranking 15 of the top 20 are Western or Central European Most are members of a supranational body Island nations fare well Geographical rankings 2. Western Europe far exceeds other regions Western Europe Central and Eastern Europe Asia Pacific Latin and South America Middle East Africa

28. www.economicsandpeace.org Four-Year Trends

29. www.economicsandpeace.org GPI Indicator Movements 2007 - 2010 IndicatorScore changeChange Military expenditure as a percentage of GDP-6.44%  Ease of access to weapons of minor destruction-1.54%  Potential for terrorist acts-0.20%  Respect for human rights-0.16%  Military capability/sophistication2.56%  Relations with neighbouring countries2.76%  Number of homicides per 100,000 people5.13%  Number of deaths from organised conflict (internal)5.16%  Number of external and internal conflicts fought15.57%  Although more countries decreased military expenditure as % of GDP, military expenditure increased Increased conflicts mainly Afghanistan Homicide increase mainly 2009 data- improved data

30. www.economicsandpeace.org Four Year Trends – Regional Changes Region Change in peacefulness % Change on 2007 Country Average Sub-Saharan Africa  -0.34%-0.01 Middle East and North Africa  -0.21%0.00 Latin America  3.02%+0.06 Asia-Pacific  3.48%+0.07 Central and Eastern Europe  3.97%+0.07 Western Europe  4.13%+0.06 North America  4.27%+0.07 Sub-Saharan Africa - decrease in ease of access to small weapons and number of conflicts fought and improved relations with neighbouring states. Middle East & North Africa – increased political stability and a reduction in military expenditure as a percentage of GDP.

31. www.economicsandpeace.org Four Year Trends – Top, Bottom Nations Country Change in peacefulness % Change on 2007 Score change New Zealand 0.00 Finland  4.17%+0.05 Ireland  7.58%+0.10 Norway  7.93%+0.10 Denmark  14.89%+0.18 Country Change in peacefulness % Change on 2007 Score change Sudan  -7.31%-0.24 Iraq  -2.95%-0.10 Israel  3.48%+0.11 Russia  7.17%+0.21 Pakistan  19.32%+0.53

32. www.economicsandpeace.org Four Year Trends – Regional Changes RegionChange in peacefulness % Change on 2007 Average country change G20  3.71%+0.07 ASEAN  3.84%+0.08 OECD  4.78%+0.07 BRIC  5.05%+0.12 EU high-debt countries  5.15%+0.08 South Asia  6.27%+0.11 All blocs performed worse than the global average of 2% down G20, OECD: major falls Canada, Turkey, Italy, Mexico EU high debt countries are Spain, Portugal, Italy and Greece

33. www.economicsandpeace.org Four Year Trends – Regional Changes 1 being peaceful, 5 being un-peaceful Overall the world became 2% less peaceful Publication Year GPI average Score Countries whose score has improved Countries whose score has worsened Countries with no score change 20071.94 20081.92683913 20091.9636777 20101.9841754

34. www.economicsandpeace.org Business and Peace

35. www.economicsandpeace.org GPI Correlations with Per Capita Income For every 10 places a country rises on the GPI: Per capita income increases by US$3,100 Consumer spending on food and non-alcoholic beverages increases by US$132 Consumer spending on leisure and recreation increased US$144 Consumer spending on household goods and services increases by US$87 Consumer spending on housing increases by US$309 Consumer spending on footwear and clothing increases by US$87 Consumer spending on communications increases by US$42

36. www.economicsandpeace.org Economic Impacts of Peace If it could be demonstrated that peaceful environments had a better propensity for stability, could long term debt be more aggressively priced? If there was a relationship between peacefulness and growth, would more capital inflows result? If there was a relationship between peace and growth, would new investment funds be created that invested in areas of the world that had the fastest improving prospects of peace?

37. www.economicsandpeace.org Economic Impacts of Peace Lower risk Lower interest rates Lower discount rates on future earnings for investments Projects pay off over long periods Larger portfolio of investment containing more stable investments Long term planning increased government spending on infrastructure such as roads, schools, universities

38. www.economicsandpeace.org Business and Peace Reductions in violence positively impact most businesses Market potential increases with rising living standards Costs reduce Management is more focused on strategic issues rather than risk mitigation There are many measures of violence – different types of violence have different impacts on different products and markets UN Global Compact Survey 80% of senior executives believe that the size of their markets increase with peace 79% of senior executives believe that their costs reduce with increasing peace

39. www.economicsandpeace.org Monetary Value of Peace

40. www.economicsandpeace.org Valuing Peace – How to value peace to the global economy Cost based on known literature and conservatively estimated Little literature that estimates many forms of violence Some literature estimates terrorism at 10% of GDP in 2002 IADB estimates 1.6% to 5% of GDP costs from violence in various Latin American countries WHO estimates inter-personal violence in US at 3.3% of GDP UNDP estimates African civil wars at 2.2% to 3.3% of GDP per year per conflict Static Peace – Value shifting from violent industries to Peaceful Industries Dynamic Peace – Additional value from suppressed or inefficient economic activity

41. www.economicsandpeace.org Monetary Value of Peace Year Actual GDP Dynamic dividend Static Dividend Total Dividend 2006$48,802$4,027$2,147$6,174 2007$54,975$4,435$2,418$6,853 2008$60,755$5,112$2,673$7,785 2009$57,522$4,889$2,530$7,419 Total$18,463$9,768$28,231 o Static Peace - Value shifting from violent industries to Peaceful Industries o Dynamic Peace – Additional value from suppressed or inefficient economic activity US$ Trillion

42. www.economicsandpeace.org Monetary Value of Peace Valuing Peace – How to value peace to the global economy Total four year value of peace – US$28.231 trillion Assuming the world could be 25% less violent, the total additional or redirected economic activity would equal US$7.06 trillion over four years Additional US$1.75 trillion per annum What could this activity finance? Millennium Development Goals US$100B p.a. EU climate change €48B p.a. US debt interest US$232B p.a. Repay Greek debt US$550B

43. www.economicsandpeace.org Value of Peace – US Industry Breakdown US$ Billion SectorInternal pGDPExternal pGDP Agriculture7.156.22 Mining14.7612.83 Utilities13.8812.07 Construction26.3822.94 Manufacturing74.2864.59 Wholesale trade37.1432.29 Retail trade40.1634.92 Transportation and warehousing18.8216.36 Information28.2124.53 Finance and insurance48.3042.00 Real estate, rental, leasing80.8970.34 Professional, scientific, technical services49.6943.21 Management of companies and enterprises12.8711.19 Administrative and waste management services19.3416.82 Educational services6.275.45 Health care and social assistance46.2540.22 Arts, entertainment, recreation6.365.53 Accommodation and food services17.9715.63 Other services, except government14.8212.89 Government83.4572.57 TotalUS$ 646.96US$ 562.60 [1] US sectoral data sourced from the Bureau of Economic Analysis

44. www.economicsandpeace.org The Violence Crisis The case of Nicaragua Data: 1950 – 2007; real per capita GDP (I$); base year = 2005 Source: computed from Penn World Tables 6.3 El Salvador was “lucky” => here is the case of Nicaragua Slide courtesy of Jurgen Brauer

45. www.economicsandpeace.org The Violence Crisis The case of Costa Rica Data: 1950 – 2007; real per capita GDP (I$); base year = 2005 Source: computed from Penn World Tables 6.3 And here is the case of a country that had no war => but its neighbors did Slide courtesy of Jurgen Brauer

46. www.economicsandpeace.org The Violence Crisis The case of the Dominican Republic Data: 1950 – 2007; real per capita GDP (I$); base year = 2005 Source: computed from Penn World Tables 6.3; UNODC (2007) Blue line: ppp-GDP Red line: UNODC projection assuming that DOM’s homicide rate were cut in half (to the level of Costa Rica’s homicide rate). Slide courtesy of Jurgen Brauer

47. www.economicsandpeace.org The Violence Crisis Real per capita GDP (I$); base year = 2005 Source: computed from Penn World Tables 6.3 time Per capita GDP Actual GDP Trend line of potential GDP Cumulative GDP losses violencepost-violence Index = 100 The pothole diagram Slide courtesy of Jurgen Brauer

48. www.economicsandpeace.org Correlations With Other Indices

49. www.economicsandpeace.org Other Indexes Well Being Indexes UNDP Human Development Index r = - 0.58 Legatum Institute Prosperity Index r = 0.72 Yale Environmental Sustainability Index r = 0.63 Yale Environmental Performance Index r = - 0.52 Economic Indexes World Bank Ease of Doing Business Index r = 0.54 World Economic Forum Global Competitive Index r = 0.58 TI Corruption Perception Index r = 0.71 World Bank Knowledge Economy Index r = 0.60 Frazer Institute Economic Freedom Index r = 0.62

50. www.economicsandpeace.org Correlations with Global Peace Index Social Attributes of Peaceful Nations Aspects of Nationalism Less likely to see their culture as superior Believe that their nation’s morality is average in foreign policy Active Civil Society More likely to perceive their media as having a lot of freedom Less likely to believe that their government can limit expression of ideas More likely to support leaders who take a compromising approach More likely to believe that women and men make equally good leaders Respect for Human Rights More likely to reject the use of torture More likely to respect human rights

51. www.economicsandpeace.org Correlations with Global Peace Index Social Attributes of Peaceful Nations Aspects of Globalization More likely to believe anyone can work in their county Less likely to believe that globalization is growing too quickly What Citizens Think of Other Nations Peaceful nations are perceived most positively by the citizens of other nations – Highest correlation of all attitudes Support for the Use of the Military Reject the use of torture Support military action when sanctioned by the UN More likely to disagree with the need to US military force to maintain order

52. www.economicsandpeace.org Correlations with Global Peace Index Social Attributes of Peaceful Nations Moral and Religious Aspects Think that their politicians do not need to believe in God Believe that good and evil are contingent and not absolute More likely to believe that it is not necessary to believe in God to be moral Less likely to believe that globalization is growing too quickly Economic Attitudes More likely to believe that anyone can work in their country Less likely to believe that globalisation is growing too quickly The strongest correlation was that nations that were perceived positively by other nations were the most peaceful r = 0.88

53. www.economicsandpeace.org Characteristics of Peace

54. www.economicsandpeace.org Resilience of Peace Why do Peaceful nations perform well? Tolerant and open societies are more likely to learn and adapt Violence needs reactive responses, peace allows for more forethought The future is more predictable in peace, allowing for better planning Peaceful societies are less likely to create alienation More likely to co-operate and support in times of crisis Freedom of information allows a better flow of information through society Broad education base creates a larger pool of human capital

55. www.economicsandpeace.org Structural Aspects of Peace Sound Business Environment Well- functioning Government Equitable Distribution of Resources

56. www.economicsandpeace.org Structural Aspects of Peace Well-Functioning Government – GPI Correlations Index NameSourceCorrelation coefficient Worldwide Governance Indicators Voice and Accountability Political Stability Government Effectiveness Regulatory Quality Rule of Law Control of Corruption World Bank -0.61 -0.87 -0.70 -0.66 -0.76 -0.72 Political Democracy IndexEIU0.56 Freedom in the World SurveyFreedom House 0.57

57. www.economicsandpeace.org Structural Aspects of Peace

58. www.economicsandpeace.org Structural Aspects of Peace Well-Functioning Government – Other Correlations Index NameSourceCorrelation coefficient Political instabilityEconomist Intelligence Unit-0.81 Corruption perceptionsTransparency International0.76 Freedom of the pressReporters without borders-0.63 15-34 year old males as a % of adult populationUN World Population Prospects-0.62 The extent of regional integrationEconomist Intelligence Unit-0.62 GDP per capitaEconomist Intelligence Unit0.61 Respect for human rightsPolitical Terror Scale-0.60 Life expectancyWorld Bank0.59 Ease of access to weapons of minor destructionEconomist Intelligence Unit-0.56 Relations with neighbouring countriesEconomist Intelligence Unit-0.56 Mean years of schoolingUNESCO0.55 Global Gender GapWorld Economic Forum0.55 Level of organised conflict (internal)Economist Intelligence Unit-0.55 Human Rights IndexEscola de Cultura de Pau-0.51 Perceptions of criminality in societyEconomist Intelligence Unit-0.50

59. www.economicsandpeace.org Structural Aspects of Peace Sound Business Environment – GPI Correlations Index NameSource Correlation coefficient Corruption Perception IndexTransparency International-0.70 Global Competitiveness ReportWorld Economic Forum-0.59 Economic Freedom of the World IndexFrazer Institute-0.58 GDP per capitaEIU0.57 Ease of Doing Business IndexWorld Bank0.52

60. www.economicsandpeace.org Structural Aspects of Peace

61. www.economicsandpeace.org Structural Aspects of Peace Sound Business Environment – Per Capita Income Correlations Index NameSourceCorrelation coefficient Corruption perceptions Transparency International0.83 Global Competitiveness Report World Bank0.77 Political instability Economist Intelligence Unit-0.66 Human Development Index UNDP0.63 Functioning of government Economist Intelligence Unit0.61 Likelihood of violent demonstrations Economist Intelligence Unit-0.61 Life expectancy World Bank0.59 UNESCO mean years of schooling UNESCO0.57 GPI SCORE Global Peace Index-0.57 Political Democracy Index Economist Intelligence Unit0.56 Respect for human rights Political Terror Scale-0.56 Ease of access to weapons of minor destruction Economist Intelligence Unit-0.54 The extent of regional integration Economist Intelligence Unit-0.53 Number of homicides per 100,000 people UNODC-0.52 Level of violent crime Economist Intelligence Unit-0.52 15-34 year old males as a % of adult population UN World Population Prospects-0.51 Infant mortality per 1,000 live births World Bank-0.50

62. www.economicsandpeace.org Strategic Business Analysis

63. www.economicsandpeace.org Peace in Strategic Business Analysis Business and Peace  Strong correlation with Global Peace Index Per capita income and peace: r = 0.57 Ease of Doing Business Index: r = 0.52 Business Competitive Index: r = - 0.59  UN Global Compact Business Survey 80% of senior execs believe markets grow with improved peacefulness 79% think their costs drop with improved peacefulness

64. www.economicsandpeace.org Competitiveness and Peace Faltering market Consider merit of Current position Mature market Exploit current competitive advantage Nascent market Avoid building market presence Market opportunity Extend or establish competitive advantage High Market Penetration Low Low Peacefulness High

65. www.economicsandpeace.org Several Traditional Business Tools Might be Considered in Light of a Region’s Peacefulness to Provide Insight Industry lifecycle Initial invest takes time to reach break even. This is based on the cost of the investment, the amount of time to become profitable and the size of the profits The level of violence will affect the cost of investment, the length of time to deploy and the ROI Profit Time

66. www.economicsandpeace.org Several Traditional Business Tools Might be Considered in Light of a Region’s Peacefulness to Provide Insight Competitor profitability Return Peace Through analyzing the return that competitors are getting by the peacefulness of their markets and the momentum of peacefulness within those markets new competitive strategies can be developed

67. www.economicsandpeace.org Several Traditional Business Tools Might be Considered in Light of a Region’s Peacefulness to Provide Insight Business segmentation What is the relation between price for the same business segment in different markets when rated by peacefulness Price sales & service product

68. www.economicsandpeace.org User Value Based Advantage Can be Considered in Light of a Region’s Peacefulness, Using Several Typical Tools Many consumers view peace as highly desirable – how can they be viewed as a consumer segment, what are their emotional needs and how can products be created to fulfill their needs Customer segmentation Customer buying process The Gatekeepers Young Socials Busy Parents Domestics Active Teens Mature Uninvolved Need Search Buy Validate

69. www.economicsandpeace.org Discontinuous Forces of Change – Including Peace Can Be Examined Using Several Tools A business, product or market is affected by many factors outside a company’s control such as government policies, corruption, rule of law. Peace is a proxy for order, peaceful markets will be more transparent therefore easier to deconstruct and easier to understand Deconstruction audit

70. www.economicsandpeace.org Questions and Answers