The mechanism
The Peace Dividend Mandate
Every dollar of weapons spending matched by certified peace infrastructure, on a ratio that moves with the conflict.
The Mandate is a structural policy, not an appeal. It applies the logic of externality pricing to the downstream costs of armed conflict, and it is drawn so that the industry asked to pay has a financial reason to want the harm reduced.
The base described in the founding paper is two dollars of certified peacemaking for each dollar of weapons production, scaling to five dollars during active major conflict. The published schedule has five tiers. The active-conflict tier, 5:1, is the lower bound of a documented external-cost range of roughly five to seven to one. It was not chosen for rhetorical force.
Work the ratio
An obligation, not a slogan.
Choose a conflict tier and a contractor’s weapons spend. The figure that follows is the arithmetic of the published schedule. It is not a forecast, and it is not five times a national defense budget. The Mandate attaches to research, development, production, and marketing of weapons.
The conservative end of the documented external-cost range, five to seven to one.
Required peace infrastructure
$5,000,000,000
At 5:1, each dollar of this weapons spend carries five dollars of certified peace infrastructure.
Full implementation, across the industry, is estimated in the working paper at $1.4 to $3.5 trillion a year. That figure is not five times world military expenditure. World military expenditure was $2.887 trillion in 2025. The Mandate does not attach to every dollar of a defense budget. It attaches to contractor spending on weapons research, development, production, and marketing.
The schedule
- 5:1Active major conflictsThe conservative end of the documented external-cost range, five to seven to one.
- 3:1Elevated regional tensionsAbove the baseline, short of active major war.
- 2:1Relative stabilityThe baseline obligation.
- 1:1Sustained peace benchmarksA recorded stretch of verified de-escalation.
- 0.5:1Verified long-term peaceThe lowest published tier. The schedule is meant to leave legitimate defense viable at the margin.
The index draws on Uppsala UCDP, the Institute for Economics and Peace Global Peace Index, and UNHCR. Removing discretion from the trigger is part of the design. A ratio a minister can reclassify is a ratio a lobby can buy.
Who holds the money
Investment deploys through certified peacemaking organizations, governed by an independent multilateral body, the Peace Dividend Certification Authority. The design called for in the paper: supermajority civil-society representation, mandatory transparency, independent funding, and no defense-industry representation on the board.
The Authority’s legitimacy cannot be asserted in a statute. Phase 1 exists to demonstrate it, including by certification decisions that powerful actors will dislike. A captured certifier reproduces the exemption under a new name.
Why the burden is convex
In the ordinary externality, the producer profits from output and harm rides along. A per-unit charge gives the firm a reason to reduce harm per unit. The amplified case is different. Harm intensity is itself the profitable margin. Marginal profit rises with harm, profit under a linear charge is convex, and the optimum is a corner: produce at the ceiling, or not at all. Deterring the ceiling requires a rate equal to the average return across the whole range, and that rate climbs without bound as the range grows, whenever marginal profit does.
A burden whose marginal weight rises faster than marginal profit restores an interior optimum, where the firm equates the two. The dynamic ratio does this because the rate itself increases with conflict. The same convexity is what keeps lobby inversion from failing at the top of the range. Under a flat charge, inversion holds only while marginal profit is still small. Once conflict is high and marginal profit has risen, the firm’s political interest points back toward war. A rising schedule can hold the other way, including there.
Inversion is not wanted at every level of H. Below a defensive baseline, the marginal burden should not exceed the marginal margin. Legitimate defense remains viable. Escalation past the baseline does not. The tiers are a discrete stand-in for a schedule that crosses at that point.
These are structural claims under stated assumptions. The working paper offers them as hypotheses. Appendix A proves the structure and marks where a result still depends on a magnitude nobody has yet measured. That measurement is part of the Institute’s next work.
Pass-through
A share of the burden is recovered in the procurement price and so is borne by the government. At first glance that looks like a leak: the firm no longer feels the full cost, and its reason to lobby for peace weakens as more of the bill moves onto the public account.
The model treats the leak as the second instrument. The war economy contains two stacked asymmetries. At the lower layer, the contractor holds costs and necessity the government cannot verify. At the upper layer, the government holds the true cost and conduct of conflict, hidden from citizens. Fix only the contract, and the government still chooses conflict against a social cost the public cannot see. Open only the books, and the contractor’s incentive is unchanged.
Pass-through writes the priced social cost into the budget as a line that increases with conflict. Low pass-through bites the firm. High pass-through lifts the burden off the firm and puts it on the government, where the cost becomes legible to the electorate. Along that continuum the corrected party shifts. There is no value at which the externality is simply left alone.
Three phases
The mechanism does not require adoption by the Security Council, whose veto sits with the largest arms exporters. It requires a market large enough that exclusion is costly, and an institution credible enough that exclusion means something.
Institutional foundation
Credibility before obligation. Design the Certification Authority, publish the conflict-level method, run a small voluntary pilot, and commission independent modeling of who would receive the investment.
Legislative anchoring
Make compliance a condition of access to willing defense markets, beginning with the European Union and like-minded states. A large market can set a standard without a veto at the Security Council.
Scale
Once peace investment is a sector, contractors who have learned it hold an advantage, and the same profit motive that built the war economy has a reason to prefer a lower ratio.
The limit of the claim
The Mandate will not end war.
No single mechanism can. What it can change is the financial landscape in which decisions between war and peace are made. Changed prices change behavior in every other domain where catastrophic harm has been reduced. The papers are the argument that there is no principled reason this domain is exempt.