In his 1910 bestseller “The Great Illusion,” Angell argued that in an industrial world of growing economic interdependence, the costs of territorial conquest outweigh the gains; war is therefore irrational. Published on the eve of World War I, the book sparked intense debate and became a theoretical foundation for deterrence through mutual dependence. After the war he supported the League of Nations’ information campaigns and disarmament conferences, constantly addressing youth audiences about the ‘unreason of war’. His claim that resources and markets can be obtained through exchange rather than force foreshadowed modern ideas of free trade and globalization. Angell’s peace education appeared in school textbooks across Europe and served as a moral backbone for the inter-war anti-war movement. These achievements earned him the 1933 Nobel Peace Prize.

In “The Great Illusion,” Angell framed the belief in security through military power as an ‘illusion,’ using empirical data on credit systems and cross-border capital flows to demonstrate that aggressive war triggers default risk and depresses investment returns. He called this approach ‘peace through understanding,’ arguing that liberal economics and parliamentary democracy are prerequisites for durable peace. During the 1920s he lectured at the London School of Economics, introducing students to theories of economic interdependence. He also helped build the League of Nations’ information section, employing newspapers, radio and pamphlets in one of the earliest mass-media peace campaigns. Scholars later traced the intellectual lineage of Karl Deutsch’s ‘security community’ and Robert Keohane’s ‘complex interdependence’ back to Angell’s ideas, making him a foundational figure in liberal International Relations theory. After the 1929 Wall Street crash he warned that rising protectionism would heighten war risks, lobbying for trade liberalization at the 1933 World Economic Conference. The Nobel Committee therefore honoured him “for having exposed by his pen the illusion of war and presented a convincing plea for international cooperation and peace.”

Angell’s framework, predicated on the structural interdependence created by the late-19th-century international gold standard, telegraph and banking syndicates, rejected realist balance-of-power assumptions through economic cost-benefit analysis. He compared rising defence outlays g with the decline in return on external capital Δr across the foreign investment stock K, formalizing the condition g > Δr · K under which war produces a net loss. He further argued that war risk adds a premium π to sovereign yields while eroding seigniorage revenue s, forcing continuous debt restructuring. This macro-cost structure anticipates insights found in modern capital-destruction models and Fearon’s bargaining-failure framework. Moreover, his use of media-content analysis and opinion polling within the League of Nations Information Section foreshadowed contemporary strategic-communication practices of international organizations. Angell’s policy papers informed the British delegation’s memorandum at the 1932-34 Geneva Disarmament Conference, providing theoretical support for revising mercantilist security assumptions.