How Conflicts and Wars in the Middle East Promotes Economic Development in the United States
Year: 2025
Type: article
Abstract: The Middle East, owing to its strategic location at the intersection of Asia, Europe, and Africa, and its huge oil reserves, plays a significant role in global economic frameworks. This paper analyzes the impact of regional wars and crises on the hegemony of the US dollar and capital flows in the United States. It employs theories of petrodollar recycling and Military Keynesianism to examine American interests in recent Middle Eastern conflicts and the impact of military expansion on the petrodollar system. This article utilizes data on arms transactions and oil trades amid Middle Eastern wars, primarily sourced from the Stockholm International Peace Research Institute, to investigate the relationship between arms and oil trading by extrapolating trends and patterns. The results indicate that the instability in the Middle East promotes the petrodollar circulation, gives the US chances to consolidate US dollars as a primary currency and could lead to a large number of US dollars backflowing to the American economy.
Author: Youjun Qian
Institution: Rainwater Charitable Foundation
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4409549805