Why would war be used to gain territory and increase power?

As a general matter, people in a given territory are not going to willingly hand over their land to another nation.  This means that if a nation wants a particular territory, it is likely that a war will be necessary.  There are means of conquering a people economically, for example, by investing so heavily in a region that one controls a substantial amount of economic activity, production of goods and services, and hiring and firing, for instance.  Nevertheless, that is a form of war, too.  People want autonomy, not another nation taking over and telling them what to do. There have been few if any instances of a people handing over the keys to a kingdom when a foreign power comes knocking.  But there is a wonderful satire called The Mouse That Roared (Arnold) in which a country in dire financial straits declares war on the United States, wanting to lose, so it can enjoy the American largess historically available to countries the United States has defeated. Generally, though, war is the only way to gain a new territory.