These internal developments also shaped the respective foreign policies of these
governments. Both states were engaged in expansion outside of their immediate
territorial borders. While the United States embarked on an aggressive program of
continental expansion, Great Britain utilized its naval strength to pursue global
hegemony. These simultaneous expansion programs placed the two states on a collision
course over the disputed Oregon territory in 1846.
This paper utilizes the Anglo-American dispute over the Oregon territory to
explore the connections among globalization, territorial expansion, and conflict in the
nineteenth century. It illustrates how globalization helped to prevent war in the dispute
over the Oregon territory in the 1840’s. It diverges from much of the commercial peace
literature by focusing on the domestic struggle over commercial policy rather than
interdependence to understand the process by which globalization promotes peace
between states. Because trade based on comparative advantage redistributes income
within economies, it simultaneously generates a political conflict over whether
commercial policy should be more or less restrictive. These domestic disputes over
commercial policy often carry over into broader foreign policy debates over territorial
expansion and war. Firms and industries that are generally competitive in international
markets lobby their states for fewer restrictions on international trade. Moreover,
because these firms can penetrate foreign markets without government assistance or
protection, they often oppose the integration of new markets through territorial
expansion. On the other hand, firms that rely on government protection to remain
competitive are more likely to support the enlargement of the domestic economy through
the integration of new territories. In short, states generally pursue more restrained
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Convention