<p>The topic of this essay is the "triangular theory" of social systems as articulated by Kenneth Boulding. This theory encompasses the role of three systems: exchange, threat, and integrative systems. It can be considered the foundation of peace economics because it comprehensively highlights: (i) the pernicious and costly characteristics of threat systems, particularly their intrinsic instability in the long run; (ii) the detrimental effects of threat systems on economic development; (iii) the key elements of integrative systems; and (iv) the existence of a stable peace as an optimal state that is conceptually distinct from deterrence due to the dominance of integrative systems over both exchange and threat systems.</p>