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Conflicts between Iran and the Gulf Arab States: An Economic Evaluation

Abstract The post-2003 Persian Gulf sub-region has witnessed intensified geopolitical conflicts and competition between Iran and the Gulf Arab states, particularly between Iran and Saudi Arabia. Scholars and experts have mostly analysed the conflicts through political and strategic prisms while neglecting their economic dimensions. This article analyses the various post-2003 conflicts between Iran and the Gulf Arab states with a focus on how economic integration or the lack thereof creates the incentives to resolve or sustain the conflicts. It concludes that low levels of trade and economic integration and the absence of an economics of cooperation between Iran and its Gulf Arab neighbours inhibit any strong initiatives to resolve the conflicts.