In business, the term “commodification” describes the transition of something previously a luxury good into a day-to-day commodity that is bought and sold cheaply. When smartphones first went to market, they were expensive luxury items. Today, while high-end smartphones are not cheap, commodified models are available for as low as under $100.

Commodification is not limited to commercial affairs. War also experiences the process in its own way. The battlefield of the medieval era, for example, was dominated by the noble knight, an extremely well-equipped man trained since birth in the arts of war. In fifteenth-century England, a top-class suit of armor cost £20 or more, the equivalent of 800 days of wages for a simple archer. There were practical considerations behind buying a suit of armor. In addition to the protection it granted from blows and the fear it inspired, knightly armor granted the wearer prestige in a culture that placed a premium on such. Moreover, since armor was used for such a long period in the medieval era, we can surmise that its long-term value was, in some sense, worth the expense.

All this changed, however, when new bow technology came into being.

The first was the English longbow. The longbow itself was not particularly expensive, but using it required lifelong training due to its high draw weight. This meant that training and using longbowmen was expensive. Next came the crossbow, which further called into question the cost-benefit of knightly armor. While more costly to produce than the longbow, it required little training. As the crossbow proliferated—eventually accompanied by similar technologies like the hand cannon and the arquebus—knights disappeared from the battlefield, surviving only in parades and chivalric tournaments.

Commodifying the Twenty-First Century Battlefield

The war in Ukraine has made it increasingly clear that modern warfare is now undergoing its own aggressive period of commodification. The driver of this is somewhat ironic: technology initially developed for military purposes, such as GPS and advanced electronic optics, has been designed for consumer products, and their price dragged down. The commodified versions of the technology are now being used to create new weapons systems that are highly effective and cheap.

The most prominent piece of this sort of now-commodified technology in the Ukraine war is Russia’s ZALA Lancet drone. These have been used extensively to target tanks and other vehicles belonging to the Ukrainian Armed Forces. It is now commonplace to see videos of Lancet drones being used to destroy advanced tanks, such as the German Leopard II.

Consider the relative costs. A Lancet drone costs around $35,000. It appears to be easy and quick to produce, with ZALA Aero Group announcing it will increase production by “several times this year.” A Leopard II tank, on the other hand, costs around $11 million. It is also slow to manufacture, with maybe fifty or so produced each year. 

This is where things begin to get absurd. On a pure cost basis, Russia can produce 314 Lancet drones for every Leopard II tank Germany produces. This gets even more dramatic if we factor in relative prices in the two countries by using purchasing power parity (PPP) adjustment—how economists make accurate international economic comparisons. With this, we find that, for the cost of producing one Leopard II tank in Germany, Russia can produce 683 Lancet drones. This raises an obvious question: is the battlefield worth of a Leopard II equivalent to nearly seven hundred Lancet drones? Probably not.

The commodification of the battlefield we have seen in Ukraine calls into question much of contemporary Western military strategy, which seems to focus on producing high-quality, high-cost equipment in the hope it can overwhelm inferior forces. Nor is this solely the case in a grinding war of attrition, as we have seen in Ukraine. Since the outbreak of the war in Gaza in October this year, we have seen various other aspects of Western military strategy be called into question by the process of rapid battlefield commodification.

At the beginning of the Gaza War, Hamas started launching extensive numbers of Qassam rockets at Israel. These are incredibly cheap to manufacture, with rocket fuels made from sugar and fertilizer. Each missile costs around $300–800 to produce. The famous Iron Dome air defense system is Israel’s defense against these weapons. A single battery costs $100 million, and each of the Tamir interceptors it fires costs around $50,000. 

Even without considering the cost of the platform, Hamas can build ninety-one rockets for every Tamir interceptor, or, if we adjust for PPP, they can make 177. The cost comparison here is straightforward because the Israelis intend to use the Iron Dome to shoot down every Qassam rocket fired into their territory, and it takes at least one Tamir interceptor to shoot down a Qassam.

Similarly, Israeli Merkava tanks seem to be vulnerable to Hamas’ homemade RPG system, the al-Yassin. The vulnerability of tanks to RPG systems, especially in built-up urban environments, is not a new development. But the capacity for a group like Hamas to mass produce their own RPGs raises serious questions about the capacity for sustained urban fighting using armored vehicles, even for well-equipped armies like the Israeli Defense Force. 

There are no cost estimates for al-Yassin rockets. But considering that RPG-7 missiles can be purchased for around $300 on the black market, it seems likely they cost maybe $200, given low labor costs in the Gaza Strip. With Merkava 4M tanks costing $3.5 million per unit, we can estimate that Hamas can produce 17,500 al-Yassins for every tank the Israelis produce, or 34,155 on a PPP-adjusted basis. We might also raise the question of just how much more effective an American Javelin antitank missile system is than a cheap RPG. No doubt any sane soldier would prefer a Javelin to an RPG when facing down a tank, but at $78,000 per missile for the cost of every Javelin produced in America, Hamas can produce 390 al-Yassins, or 784 on a PPP-adjusted basis. 

The aggressive commodification of the modern battlefield really started to be driven home in recent days when the Houthi rebels in Yemen managed to impose an effective naval blockade in the Red Sea—all without possessing a navy. Throughout human history, the capacity to control the seas—and hence, to control commerce—was only available to wealthy countries that could allocate a substantial amount of their national income to build a serious navy. But the commodification of the modern battlefield has changed this dynamic.

The key moment in the blockade of the Red Sea was the successful targeting of a commercial ship with an Iranian anti-shipping missile. Information on the specific model of the missile is scant, but there is no doubt that the missile costs substantially less than the air defense missiles used by Western naval vessels to counteract them. Indeed, reports have already highlighted that the U.S. Navy is using $2 million missiles to shoot down Houthi drones that cost a mere $2,000. 

The nature of this new weaponry also raises more fundamental problems. When the blockade was enacted, there were calls for the U.S. Navy and its allies to bomb the Houthis into submission. But what exactly would they bomb? Presumably, these new missiles and drones can be transported anywhere in the Houthi’s territory, set up, and fired—possibly even remotely. By the time the U.S. Navy gets a target, it might just be a cheap launcher or, at best, an empty truck.

The “Home-Field” Advantage

All of this raises a number of questions. Is it wise to compare respective countries’ military power based on total expenditure? In an essay in American Affairs earlier this year, I demonstrated serious problems with doing this and argued that we should stop using this metric. While I provided some examples in that essay, recent developments have provided us with many more. The empirical evidence seems to prove the hypothesis with increasing rapidity. Discussions of military power citing total expenditure should simply not be taken seriously anymore.

Then, there is the question of the American military-industrial complex itself. Is it fit for purpose? Is its high-tech, high-cost model suitable for a modern battlefield? Are its enormous, largely integrated supply chains even necessary? Much of the technology used to produce the new commodified weaponry can be sourced on the commercial market. A similar engine to that used in Iranian 358 missiles can be purchased on AliExpress or through hobbyist drone websites for a few hundred dollars. 

Perhaps it is time to reevaluate how we spend on weaponry and what we buy. Perhaps, too, it is time to reassess what a conventional military force can and cannot achieve on this newly commodified battlefield. All the available evidence seems to suggest that this new environment gives a strong “home advantage” to belligerents. Navies have long been the favored power projection tool in far-off regions of the world. But if vessels can be so easily and cheaply threatened by newly commodified weaponry, their utility may be far less than in the past.

Philip Pilkington is a macroeconomist and investment professional, co-host of the Multipolarity podcast and the author of The Reformation in Economics.