Abstract
This article analyzes the formation of states to provide public goods including but not limited to security. The analysis views national borders as arising endogenously, with the decision makers balancing a trade-off between the benefits of economies of scale in the provision of defense against external threats and the costs arising from greater heterogeneity in preferences across citizens of the nation regarding the provision of other public goods. The article develops a simple model that highlights this trade-off and discusses a number of issues related to peace and conflict. It also touches on a number of possible directions for future research.
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