I used to be a counterthreat finance analyst for the U.S. Department of Defense. My job was to follow the money of bad actors and confiscate it so they couldn’t buy weapons or fund their operations. Our motto was “no bucks, no boom.”

We know a lot about how war economies work and how conflict is financed. Conflict creates demand for increased security (just ask Europe, who plans on expanding defense spending up to €800 billion in coming years in response to Russia’s invasion of Ukraine), extraction, and emergency logistics. Supply chains and economic incentives reorganize around scarcity and protection. And actors profit from war, as explained in a recent Daily podcast on the “Gold Rush” in the Sudan war.

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Markets also know how to price risk. They discount volatile territories, demand higher returns, and businesses insure themselves against disruption. And investors use these models to make decisions about which bus

What markets don’t yet do price is stability itself, nor the conditions that make peace profitable and durable.

This is a problem.

The world is experiencing the highest levels of conflict since World War II, and the cost of violence drains $19 trillion from global GDP annually. At the same time, prevention and peacebuilding regularly show outsized economic returns—of up to $103 to $1.

So it continues to baffle me that traditional investors treat conflict as a red line, or insist that countries affected by conflict are the responsibility of the public sector to “deal with”.

Peace remains a precondition for investment, rather than an investable outcome with potentially huge returns.

But there is a growing number of people who think about investments and peace differently. The elimination of USAID earlier this year has accelerated and congealed small pockets of investors, businesses, peacebuilders, and scholars like me who want to know as much about peace economies as we do about war.

Here’s a short description of what, who, and why they are thinking about this emerging concept of peace economies.

What a “peace economy” actually means

To me, a peace economy is a system where capital, policy, business operations, supply chains, and community priorities are aligned to reduce the drivers of violence and strengthen the basics that markets need to function: safety, stability, trust, and predictability.

It’s not CSR. And it’s not generic “S” in ESG. Those can be an entryway, but the concept of “peace economies” is about something more fundamental: the things in the system that incentivize peace over war.

These are explicit incentives—built into financing, governance, and operations—that make social cohesion and conflict prevention part of how value and profit are created.

If war economies reward behaviors that escalate zero-sum dynamics to the point of people killing each other, peace economies reward the opposite: inclusive growth, fair rules, credible dispute resolution, and localized legitimacy. In short: life.

In practical terms, that looks like changing how investments are structured, how risk is conceived and calculated, how performance is measured, and who has a seat at the table.

Who is building it

People. And groups of people are already in motion.

· Peace-focused investors, philanthropists, and venture funds like BVentures, Total Impact Capital, Shuraako Capital, and the Rockefeller Foundation are testing products that prevent or de-risk violence, build conditions for resilience, and address root causes of violence (even if they don’t think about it in that way), while delivering commercial and community value.

· Groups like Finance for Peace, Business for Peace, and the Institute for Economics and Peace are working to standardize indicators so peace outcomes are visible to capital markets. They’re developing the tools and metrics to avoid peacewashing.

· The Alliance for Peacebuilding has established the Building Peace Economies at Scale initiative to build bridges and highlight the common cause between peacebuilding practitioners and the financial sector, including corporations, entrepreneurs, venture capitalists, and investors.

· On the ground, civil society and local enterprises are co-designing operations that reduce flashpoints—land use, hiring, procurement, and grievance handling—because those details determine whether companies become stabilizers or accelerants of conflict. They’re also working with populations who have experienced violence to heal from the trauma and become thriving members of the community once again.

This is bottom-up and top-down at once.

Why this matters now

There is more conflict today than since WWII and this trend is increasing, not decreasing. The old commercial and investment approach—avoid “red” countries and assume the public sector will tend to those areas—no longer applies. As ODA funds are slashed globally, stabilizing forces and investments have and will disappear, and previously secure and established markets will fall into the “red”. Supply chains already run through fragile regions. Digital and cultural spillovers mean reputational exposure doesn’t stay inside borders where conflict occurs. And the opportunity cost is real: prevention and stabilizing investments compound value over time, while crisis response burns capital on losses that are totally foreseeable.

There’s also fatigue with performative ESG. Investors want materiality and mechanisms, not virtue signaling or frameworks that have become part of culture wars. Peace economies answer that by treating stability as an operational moat: lower turnover, fewer shutdowns, better community intelligence, tighter brand trust, and more predictable cash flows. None of that is theoretical. There are already businesses operating like this, and the hope is that they set the new normal.

The bottom line

We’ve spent decades studying how people profit from war. We’ve invested much less in learning how to make stability itself a source of advantage. Peace economies don’t ask markets to be charitable. They ask markets to be smarter by pricing the conditions that keep enterprises open, employees safe, and create value beyond quarterly profits.