Some wars are predictable. There are conflicts past and present which have been more or less expected because of economic and social conditions, a country’s history or that of its neighbours.

In today’s geopolitical landscape, one warning sign that really stands out is the buying and selling of weapons. There is good evidence that a surge in arms imports tends to increase the risk and intensity of future wars.

Building up military power does not merely prepare a country for war. It can also fuel the geopolitical tensions that make war more likely.

And there are economic effects too.

Our research shows that when a country starts buying more weapons, its stock market tends to fall. We found that increases in a country’s arms imports are associated with statistically and economically significant declines in its financial markets.

Weapons procurement also serves as a strong predictor of market movements – stronger even than the actual outbreak of a military conflict. This may be because markets are driven by surprises. And by the time a war begins,........

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