Geopolitical stability drives economic growth significantly.

Geopolitical stability drives economic growth significantly. A new economic study analyzing 373,020 geopolitical events across 193 countries from 1960 to 2024 reveals that improved bilateral relations increase GDP per capita by approximately 10 percent over 25 years. Researchers used advanced language models to classify decades of geopolitical data and found these effects operate through four key channels: domestic stability, investment levels, trade flows, and productivity gains. The analysis shows geopolitical factors account for GDP variations ranging from negative 30 to positive 30 percent across different countries and time periods. This research demonstrates that international relations are a first-order determinant of economic performance, not merely secondary considerations.