WHY DO NEIGHBORS FIGHT? PROXIMITY, INTERACTION OR TERRITORIALITY of John A.

Vasquez
1. Introduction
A number of scholars underline how democratic countries don t start war against each other. But in this article Vasquez
examine the fact that most wars occur between states that are neighbours. But democratic states do not fight against each
other. The real question is why the neighbours fight. In this case, neighbours fight all states are incline to war. And in
particular they fight between neighbours because only a few states have the opportunity to fight wars with nonneighbours. Most researches do not think in the relation between neighbours and war. For him it is a mistake.
2. Contiguity, neighbours and war
Lewis Richardson analysed that of the 200 wars the found from 1480 to 1941, over half were involve two parties, 28 three
parties and 12 had forth parts- For Lewis said that there are an empirical evidence that most wars are between states that
are near (neighbours). Also Wallerstein said the same (important the factor if the territories are contiguous). Diehl showed
that 12 of 13 wars started for territorial problem- Gochmnab said that 66% of the states involved in the conflicts are
contiguous. Bremier said that there are 7 important factors and the contiguity is the most important. Contiguity effect the
others 6 factors.
We can see one analysis that describe that the 80% of the wars fought since 1815 were among neighbours. Another
analysis said that from 1816 to 198, the wars started between neighbours were 88%... others analysis. Richardson
underlines how in the modern system since 1945 the wars are between neighbours.
3. Assessing Competing Explanations
3.1. Proximity and interactions explanations
The distance sometimes is the explanation how the parties don t have nothing to fight about. States is easier that use force
near at home. In particular because the distance is a very disadvantages.
But there is an important point: neighbours are neighbours for long time, but they don t fight all the time. So the real
question is How can proximity cause war??
First we have to said something important. In the last years the technologies extend the global opportunity and in the
same way an opportunity to make a war also between states that are not contiguous. We can see a clear example as United
States, Japan, UK (in the Falkland wars, etc). The technology shift also the war from the air power with the missile
capability.
Accroding to Goachman, as a number of interactions between two states increase the number of disagreements is
increase. This one is one of the cause of the war. This idea contradict:
1) The theorist of neoliberal (economic, cultural, exchanges, etc interactions reduce the probability of war)
2) The notion that hostility leads a reception in interactions and a break in economic and diplomatic relations (as during
the Cold War). (So a increase the idea of war). => Credo
in the 20th century particularly in the post 1945 period, the relationship between contiguity and military confrontations
should weaken in comparison to the earlier period. According to Goachman this one does not happen. Infact the Increased
of technology increase interactions among non contiguous states. In this way non contiguous dyad should have as many
wars as a contiguous dyad.

3.2. Territoriality Explanation

We can see a rise of the war for territorial disputes between states that they can solve with other means. The proximity is
an opportunity for war, territorial disputes provide willingness (volonta) to go to war. Wars are less frequent among nonneighbours because the don have economic, ideological or political disagreements. And also they don t have the problem
of territories between them. Territorial issues are sources of conflict.
For realists, war can and does occur for any issue, because any issue can give rise to a struggle for power. Important
territory because provide spaces, food and resources for living- The issues of territory is a best situation by use of force
and violence. The human tends to occupy and defend the territory. Wars arises not from territories, but because the states
want to demark boundaries and/ or maintain and expand their territories. Wars in not inevitable and nor be persistent.

When boundaries are accepted, peace can reign. These is really different from the realistic vie, that they sees conflict and
war as a constant.
We can see in the wars involving in the history how the territorial issues tend to be the most prone to war. Territorial
issues dominated the war for almost 350 years. Only in post 1945 period the territorial issues not been in a majority of
wars. There are some theorist that analyse that the state that have more borders should experience more wars. Or someone
analyse that the post 1815 period have more states so this mean also more wars.

3.3. Evaluation
1) Important is understand the sensitivity if the borders, and the concentration of war among neighbours.
2) Also the proximity interactions explanation can offer a simple explanation of the concentration of warfare among
neighbours
3) Territorial factors become really relevant after the cold war
=> with all the issue that can give rise to war, territorial issues are most prone to war
The thing that we have to underline is that they don t see the war as a inevitable as a realists. When the boundaries are
establish, peaceful reign in the territories.

4. Specific crucial Tests

1. the close distance provides an opportunity for wars. The wars are concentrated among neighbours because territorial
provides a motivation for war and the willingness to go to war.
Some important point:
- When the both parts are satisfy probably there is not more reason to make a war. There is not constant wars among
neighbours
- Probably there are not conflicts if they don t have territorial problems. So if the accepted they borders we can see a
period of peace
2. The territorial explanation see the creation of buffer states to solve some territorial disputes. Difficult that buffer states
produce peace.
3. the proximity and interaction explanation see wars arising between neighbours from a variety of issues
4. natural demarcation helped to divide the borders
5. Neighbours are more prone to war because they interact more frequently than non-neighbours. Technology help that
non contiguous countries have the same interaction than contiguous. In this way the non contiguous countries have the
same opportunity to make a war as the neighbours. Also, technologies innovations should reduce the loss-of-strength
gradient for a number of states, particularly with the spread of naval power, nuclear weapons, missiles, etc. This one cause
also a was between non contiguous countries

5. Conclusion: some policy implications

war and peace ae complex process. it is important to understand the complexity of the process. After the cold war we can
see how territorial explanation are the most dangerous issues that any state will face. More states, more complex the
situation. we can see the different between Europe and North America. There were more wars in Europe (more states).
Scholars have to pay more attention to the effect about the territory have on war.
Today the greatest threats to peace come from nationalist claims for new states (in particular with ethnic groups). There
are two important problem: 1) raises of new territorial issues; 2) incresse the states in the system that want to demark their
boundaries.

=> the collapse of Urss and its sphere of influence has produced wars and conflict in part because of these two effects.
Also the break of Yugoslavia, there were a creation of the new states with the idea of nationalism. New states, new border
so new conflicts. The wanted the division basis of nationalism and self determination.
There are a lot of ethnic minorities that do not have states, and many of this minorities are exploited or the victims of
injustice. => the probability of war increases. One way to produce peace is de-territorialization. When the issue is linked
to the territory, there is a problem. The problem is that the ethnic groups want their own territory (want dignity, language,
standard living, etc).
We need to developments the international laws to try to resolve some problems. there are always more conflicts in
aprticular after the second world war because the people not consider the importance of centrality. If we understand the
problem of territoriality and that the most wars start between neighbors we have the key of the peace.

THE CAUSES OF THE WAR AND THE CONDITIONS OF PEACE of Jack S. Levy
The end of the cold war, the nuclear revolution, the rise of antinational conflicts, and the spread of global capitalism and
democracy have led to considerable speculation about a turning point in the history of warfare. Some saw the end of the
history(Huntington) and other the clash of civilizations All are interested in the same topic: We have to understand
what cause the war.
This question started when Thucydides wrote his History of the Peloponnesian War. There was an important progress in
the International relation after the WWII. Anyways there are no consensus (also the methodology) as what the causes of
war are.
THEORETICAL PRELIMINARIES
The dependent variable
International relation theorists define was as large-scale organized violence between political units (1000 fatalities). Peace
is defined by the absence of war. People also distinguish between civil wars, wars from imperial, colonial, and the other
international wars that involve non-state actors.
We need to understand what makes war is possible and the condition for war. Peace is more common than more, thought
as a non event peace is difficult to measure. There were more states that have peace than war.
So the real question is what cause war? why in one certain period, in some historical context, under some political leaders,
etc. how do we explain the origins of a particular war?
Waltz and the other neorealist said that the cause of the war is the anarchy structure of the international system. Anarchy
defined as the absence of a legitimate governmental authority to regulate disputes and do agreement between states. So
there is war because there are no government in the international system to prevent the wars. Other neorealist see other
variables.
Other feminist theorist see that the cause of the war are the woman (patriarchal system and gender relation are different in
the history. So difficult support this idea).
The levels of Analysis Framework
Waltz classified the causes of war in terms of their origins in the individual, the nation-state and the international system.
Following Waltz, most scholars use the level of analysis with a indipendet variables

THEORIES OF THE CAUSE OF WAR

Systemic-level theories
Systemic level explain the system level that includes all states. It takes into account both position of the states:
international system and interrelationships. The position of the states constitutes the systemic structural level of analysis.
This mean the distribution of power; geopolitics; and the power of the state in land or sea. The interaction of state
constitutes the process of the analysis: make alliances or negotiation between states (explanation of the WWI is the absent
of the league of nation. An organism to prevent the war. The WW is the cause of the failure of this system so led to a new
institution as the United Nations)
The realists tradition has dominated the study of war since Thucydides (including Machiavelli, Hobbes balance of Power
theorists, Waltzian neorealist and Hegemonic transition theorists). The important point is that the actors in the world
polics are sovereign states that act to advance their security, power and wealth in a conflictual international system
(because international system don t have an authority to regulate the conflicts or enforce agreements).
So make a war to preserve their position than lost it. The state provides for their own security armaments a alliances to
possible threats. This is a security dilemma: the action of the state to have security can cause the decrease of the security
of the others, including itself.
=> so security dilemma: It is a term used in international relations and refers to a situation in which actions by a state
intended to increase its security, as increasing its military or making alliances, can lead other states to respond with
similar measures, producing increased tensions that create conflict, even when no side really desires it.
The key division in the realists theory is not between classical realism and neorealism but between balance of power and
hegemonic theory. Balance of power includes numerous variation of classical realism of Morgenthau and more structural
realism of Waltz.
Balance of power theory said that the most important goal for the state it is maintenance the equilibrium of power in the
system. Also is successfully against the hegemony (it is important formed the blocking coalition).The coalition have to
eliminate the hegemon and return to a state of equilibrium (with the war hegemony: a war against the hegemony). All are
agree that an equilibrium of the military capability increases the stability of the system.
There is a discussion between classical relists, who said that multipolar system is more peaceful, and neorealist who argue
that bipolarity is more stable than multi polarity. They was influence by the cold war (presence of nuclear weapons). But
we have examples in the history where the bipolar system was not peaceful (Athens-Sparta / Hasburg-Valois in XVI
century). Anyways this theory emphasizes the existence of the hierarchical system. There is also the idea of the preventive
war to block the rise of the hegemony. The resulting hegemonic war generates a new hegemonic power, and the irregular
hegemonic cycle begins.
After that there is the question of the economic interdependence and war. It is an old question that has attracted new
attention in the past few years. Ad example Montesquieu said that peace is the natural effect of trade. In the other way
liberal economist as Smith and Ricardo said that free exchange of the international markets is the best guarantors of
peace. They thing that trade generates economic advantages for both parties. Furthermore the war reduces the trade.
The realistic think that the effect of the trade in the war or conflict is small relative to the military and diplomatic
considerations.
Some theorist underline how gains from trade create dependence. This dependence is often asymmetrical and one part can
use economic coercion to exploit the adversary. These actions can lead to the war.
societal-level Theories
This section focuses on different theories of war and theories of logrolling and coalition formation.
Liberal and Marxist theorists suggest that mass public opinion is peaceful. If a state initiates a war it is usually because
political leaders or the capitalist class choose war over the desires and interest of the public.
But in the other way we can see as there are some case as American Civil or the WWI in Europe the people want to enter
in the war. The enthusiasm of the people cause that the leader take more risk or adopting an aggressive strategy. Some
times the states fight outside to resolve the problem inside.
Some scholars see the economic cycles and electoral cycles. They said that there are a spread of military abroad during
the period before the elections, during period of poor economics performance or when domestic political support is low.
Many of these studies is concentrated in the democratic countries but also in non-democratic states (Argentina in the
Malvinas, Germany in WWI, Russia in the Russo-japanese war, etc.)

The use of force is also depends on the potential benefits, the probability of diplomatic victory, the domestic cost and risk,
and so on.
Galpi find the relation between the non democratic and democratic government. Usually the war is started by the non
democratic.
In particular the ethnic adversaries become a perfect scapegoats
Most of the Theoretical and empirical studies analyse how there is a political elite that increase the support of mass and
exalt the interest and the honour of the nation. The elites and the masse sometimes are not unified. And some times the
elites are divide.
It is important to understand why political elites engage in external scapegoating and explanation why scapegoating
works to reinforce or maintain their domestic support.
Lenin explanation of the WWI is that it was cause by the imperialist classes to move the attention of the labouring masses
form the domestic political crisis. Marxist Lenin models of imperialism supports that the external expansion and use of
force serve as a interest of the elite and not for the society. The benefit of the expansion go for the elite and the cost of the
expansion are diffused in the society in the form of taxation
Individual-Level Theories
The individual level of analysis locates the causes of events in individual leaders or the circle of decision makers within
particular country It is focuses of human actors (for example cause of WWI is from the particular leaders in power at that
time). Levy said that the losses and gain lead to some behaviours: States leaders take more risk to maintain their
international positions, reputations, and domestic political support; after suffering losses, political leaders do not accept
losses and take excessive risk to cover this losses; after making gain the state leaders take excessive risk to protect those
gains against the losses; it is more easy for states cooperate in the distribution of gains than in the distribution of losses.
Conclusion
=> to him to understand the international relation is not a single level. we have to analyse and consider multi
methods to understand the causes of war

Interdependence and Conflict: An Introduction

Mansfield and Pollins
Over the past few decades, there are an interest in the relationship between economic interdependence and political
conflict. This one help justify the formation of the European Economic Community.
The concept Links between Interdependence and Conflict
Open International markets and heightened economic exchange inhibit interstate hostilities
1. At the level of the nation-state. Economic exchange and military conquest are means to promote economic
growth. Another liberal argument is that economic intercourse increase and promotes the contact and promotes
communication between private actors and different countries, as well as between governments. Rising contact
means rising also the cooperation between countries.

2. As trade and foreign investment increase, there are fewer incentives to meet these needs through territorial
expansion, imperialism and foreign conquest
3. Conversely, barriers to international economic activity stimulate conflicts of interest that can contribute to
political-military discord
4. At the level of the country-pair or dyad- economic intercourse increases contact and promotes communication
between private actors in different countries, as well as between government. Rising contact and communication,
in turn, are expected to foster cooperative political relations
5. Commercial openness generates efficiency gains and privates and consumers become dependent on foreign
markets. These actors have reason to press public officials to avoid military conflicts. Montesquie said that the
natural effects of commerce is to lead to peace. Two nations that trade together become mutually dependent. one
is interesting in buying and the other one is interesting is selling. and all unions are based on mutual needs.
Liberal economy order makes and maintain the international security. (public officials - who rely on societal
actors for political support and have an interest in bolstering their countrys economic performance - have reason
to attend to such demands).
=> however the liberal has been criticized because the economic exchange can undermine national security. Also the
gains of the state are not distributed in equal parts => these one affect power relations
Waltz talk about myth of the interdependence. More interaction with the other states mean more probability of
disagreement and conflicts. So interdependence produce intolerance.
Theoretical issues for Further Exploration
Microfoundations
We have to understand why and how economic exchange influences the outbreak of armed conflict. Three areas deserve
attention in theoretical development: the identification of relevant actors, strategic interactions between these actors as
they pursue their goals, and the role played by international economic in the process of conflict generation and conflict
escalation.
Albert O Hirschmann has pointed out that the gains from trade often do not accrue to states proportionately
Identification of relevant actors:

subnational: firms and consumers (hostilities could rupture important economic ties)

national: Leaders hope to satisfy material needs via conquest rather than trade

Supranational: Globalization; Capital markets => trade organizations reduce the risk of armed conflict among
members

- Connect actors to levels of analysis so you can get all these causal variables
- Realist explanations tend to view the state as the only relevant actor
- Liberal explanations tend to focus on sub/supra-national ()

Institutions through which interests are filtered:

Democratic institutions and their associated constraints on national leaders may be a necessary condition for
economic interdependence to inhibit conflict

Integration of the state into the global economy shapes the interests of varying coalitions (PACIFIC or aggressive)

-Wars happen in 2 stages:

Outbreak of a dispute between states and escalation of this dispute to the point where force is applied.

There are studies where consider how economic exchange influences the outbreak of conflict. However they don t explain
how economic interdependence influence the escalation of disputes
One possibility is to said that (Escalation) armed conflict is a consequence of failed interstate bargaining (contrattazione)
and to link economic ties between nations to the bargaining process. Interdependence as a signal, the cost are related to
the extent of economic exchange.
Gartze said that since the costs of war are prohibitive, the war is unlikely (use brinkmanship: politica del rischio
calcolato). YES, low-intensity conflict but unlikely to escalate.

Boundedness and Contingency

Argument about the relationship between interdependence and conflict are use by a lots of actors. some studies during
these years complex the argument. Also someone said that the effects of economic exchange on the outbreak of hostilities
depend on various domestic and international factors.

Space-time both have changed. Economic exchange on the use of force changed over time. increase trade has
decrease the conflict during the period since World War Two [and other scholars arrive a such conclusions for the
19th and 20th century]. Others studies focusing on the XVII and XVIII, and how the expansion of the commercial
rivality and sometimes stimulated armed conflicts. Commerce has expanded in the last 4 centuries in 2 policy
contexts: Mercantilist era ( state-directed and imperialist) and liberal economic regime. => this change the
relation between interdependence and conflict. We have to understand how the effects of interdependence change
over the time. Ad example also during the WWII we can said that the interdependence have a less influence on
conflicts between major power than on dispute between weaker states

Recent research see that if the interdependence promotes or not promotes conflict depends on interaction between
various domestic and international factors
- one set of the study found strong evidence that heightened trade flows decrease the outbreak of military disputes
between members of PTAs (institution designed to liberalize commercial among participants). Others found no evidence
- domestic economic conditions influence the impact of interdependence on the probability of the conflict.
- Etc
=> in shorts these studies indicates that if interdependence promotes or not conflicts depend on the interactions among
various domestic and international factors
He suggests various areas for more research to understand the correlation and understanding: market economies;
politically relevant dyads; mercantile era; etc
Status quo vs revisionist power!
East China Sea! Japan v China?

- The conceptualization and Measurement of interdependence and conflict

Important is how to define and measure both interdependence and conflict
1) CONCEPTUALIZING INTERDEPENDECE
1. A group of countries is considered interdependent if economic conditions in one are influence
the condition of the other (inflation in one places put pressure an other prices) => SENSIBILITY
interdependence
2. Those countries where it is costly to rupture/ forego their relationship (OPEC and advanced
industrial countries) => VULNERABILITY interdependence.

The big difference it is the cost that countries would be support. This influence the point of
break.
2) OBSERVING INTERDEPENDENCE
- Measurement for interdependence usually emphasize one of three themes:
1. Openness: relation of trade to the total economic production (higher the trade crossing
boundaries, greater cost of interruption)
2. Vulnerability: do not share the same level of consensus about the measurement. However
they have an asymetry indicators for the trade. Usually the indicators are constructed using the
portion of trade (imports/exports) between a given pair of states (represented in their total
trade). the more these two figures differ, the greater the asymmetry between a and b
3. Gain: This measure relies on the counterfactual (what total product if no cross-border trade):
economists rely on import (or export) price elasticity data
- Openness is the most used (ratio of trade / output). Heightened global trade (as % of global
output) inversely related to frequency of war throughout the international system during 19 and
20 century (oneal and russet- dyadic level; domke- unit level (those nation.))
=> Caveats for vulnerability
1. Size of the flow of trade between states (taken either by itself or as a percentage of national
security) may not accurately reflect the costs to them of their economic relations were disrupted
(eg. substitutes, little trade-vital trade)
2. Raleation of trade flows between states to the national income can suffer from the
independent effects of national income of each trade partner is that this value tends to be higly
correlated with each partner economic size. It is well know that economically large states end to
be politically powerful and that powerful states are disproportionately likely to become involved
in military conflicts.
3. Costs conception of vulnerability may be too restrictive since some claims regarding
interdependence and conflict center not on the economic consequences of disrupting commerce
but rather on the security implications of dependency or highly asymmetric trade relations
(restraining only one party). Marxist and world system scholars view see the asymmetric trade
relations as exploitation and a prospect for the conflict.
- International trade flows, monetary relations, and the cross-border movement of capital,
institutions such as PTAs (arrangement that can help the interdependence) should be included,
increasingly. In particular they analyse the case of the IMF

- CONCEPTUALIZING CONFLICT
The influence of interdependence depend not only on the form and economic being analysed but
also on the type of international conflict being explained. Economic interdependence affect low
intensity conflict, high intensity conflict or both.
What forms of interstates conflict should interdependence address?
The most ardent advocates of the liberal position would expect interdependence to
eliminate political conflict at all levels of intensity , though much oft-cited work by Immanuel
Kant, the Manchester liberals, and others on war (Doyle 1997, chaps. 7-8.
Others think that States may continue to voice their differences and perhaps even
threaten sanctions or the use of armed force but domestic trade interests will restrain them
from acting on such threats (thus preventing escalation to the highest levels of conflict) lest
commerce be disrupted
Versus, Realists thinks that concede that trade could suppress less salient interstate
conflicts, while denying any systematic effect as conflicts become more serious, placing core
national interests at stake (e.g. Viner 1951; Waltz 197).

- Future work should explicitly consider the likely effects of interdependence on lower- intensity
conflict (trade disputes, sanctions, and threats of force), higher-intensity conflict (mobilization,
the use of armed force, and full-blown wars), and the escalatory (allentare) and de-escalatory
process in conflict.
OBSERVING CONFLICT
Some earlier statistical research on interdependence and hostilities relied exclusively on event
data sets, such as the Conflict and Peace Data Bank (COPDAB) and the World Event Interaction
Survey(WEIS). The major number of such studies conducted during the past ten years has
focused on militarized interstate disputes (MIDs), which are episode in which one state
threatens, displays, or uses force against another state.
The COPDAB, WEIS and MID data sets underlines different types of the foreign policy behaviour.
COPDAB and WEIS record events over the broad-est spectrum of international interactions
(cooperative as well as conflictual) from low intensity hostility. In contrast the MID data set only
records the case that involving the threat, display or use of armed force. In the COPDAB
tradition, conflict is conceived as a continuous flow marked at regular intervals. The MID tradition
views conflict as a discrete episode whose time span may be very brief or sometimes quite
prolonged.
In sum, more attention needs to be paid to the aspects and type of political conflict that should
be the focus of work on interdependence and hostilities. It is clear that the prevailing diplomatic
climate, the occurence or absence of a militarized dispute, and war are only weakly linked.
Conclusion
The relation between economic interdependence and hostilities started a decade ago. These
recent studies have made considerable progress in take in consideration some key aspects of the
influence of interdependence on political tensions.

12/03/2015
STRUCTURAL REALISM:
INTRODUCTION
The great power pay attention to how much economic or military power the states have. It is
important not only to have an important amount of power, but also make sure that no other
state take the balance of power in favour. There are different among the realists. They try to
answer to a question: Why do states want power?
- Four questions: why do states want power? How much power do they want? What causes war?
Can China rise peacefully (the thematic of the case study)?
Realists = international politics = power politics
- It is important not only to have a substantial amount of power, but also to make sure that no
other state sharply shifts the balance of power in its favour. For classical as Morgenthau the
answer is human nature (human born and want the power).For structural realists human has
little to do with why states want power.
- Why do states want power?
1. Classical realists = human nature = They want to be leader = the great power dominate
2. Structural realists =/ human nature but = Ignore cultural difference among state as well as
differences in regime type (autocratic or democratic) because the international system creates
the same basic incentives for all great powers. In the system where there is no higher authority
that sits above great powers and in a system where there is not guarantee thta one will not
attack another... has a god sense for each state have enough to protect itself in the event it is
attacked.
there are a significant division inside this structural realism:

=> Defensive realists= structural factors limit how much power states can gain= in this way
betters security competition. (as Waltz)
=>Offensive realists = the structure of the system encourages states to maximize their share of
world power (pursuing hegemony) = intensifies security competition (as Mersheimer)
- For classical realists, power is and end in itself; for structural realists, power is a means to an
end and the ultimate end is survival.
The state have two power: the military (Great power: need money, technology and personnel to
build military forces and to fight wars ) and the socio economic ( Latent power: wealth and size
of the population => the raw potential to competitive with the rival states) that build the military
power. The war is not the only way to gain power. We cans ee also states as china in las few
decades: increase the size of the population and share the global wealt
WHY DO STATES WANT POWER?
it is for the international system.
5 assumptions about the international system:
-

Anarchic system (opposite of anarchy? hierarchy). There is not centralized authority or

arbiter above states (not means that leave in chaos and disorder)

all states possess some offensive military capability (all states have the potentiality to
damage the other)

states can never be certain about the intentions of other states (revisionist states versus
status quo states; however intentions cannot be empirically verified)

main goal of states is survival (integrity of the territory and the autonomy of their
domestic order)

states are rational actors (strategies to maximize their prospects for survival; however
because states operate with imperfect information in a complicates world, they sometime
make serious mistakes)

The live with the fear that another state have the capability and the same motive to attack
them. When we have a problem, there is nobody in the international system to answer the call(in
the national system: police, ambulance, military etc). So the best way to survive is to be
powerfull. And they don t ant that the other states take more power. If you don t have power you
don t have less possibility to survive. Important is the idea of the security dilemma.
When all the assumptions are combined together = circumstances arise where states not only
become preoccupied with the balance of power, but acquire powerful incentives to gain power at
each others expense.

HOW MUCH POWER IS ENOUGH?

=> Defensive Realists:

1. It is better for states to try to maximize their share of world power, because the system will
punish them = hegemony is dangerous.
2. Kenneth Waltz: appropriate amount of power (not maximize).
- Too powerful, balancing will occur;
-And offence- defence balance (no central wars)
Defensive realists emphasize if any state become powerful, balancing will occur. In particular the
other great power build up their militaries and form a balancing coalition to eliminate or destroy
the hegemon (it is happen in the Napoleon France, Imperial Germany and Nazi Gemrany)

In sum, not only is conquest difficult but, even in those rare instances where great powers
conquer another state, they get few benefits and lots of trouble. According to the defensive
realism, these basic facts about life in the international system should be clear to all states and
should limit their appetite for more power.
=> Offensive realists
Good strategic sense for states to gain as much power as possible= pursue hegemony (not
because conquest or domination is good but to ensure ones own survival). It is important the
power to guarantee the survival.
-

Buck passing (not all members)

(for classical realists, power is and end in itself; for structure realists, power is a means to an end
and ultimate end is survival).
- They understand that threatened states usually balance against dangerous foes, but they
maintain the balancing is often inefficient, especially when it comes to forming balancing
coalition, and that this efficiency provides opportunities for a intelligent aggressor to take some
advantages of its adversaries. Defender has a significant advantages over the attacker. They
think also that is difficult to gain the hegemony (imperial Germany came close to achieving
hegemony in Europe during the First World War, etc). Different is with the nuclear weapons. It is
possible but no likely (in particular if both states have nuclear weapons. If the other doesnt t
have it is sue for the offensive purpose).
for all of these reason, offensive realists expect that the great power are constantly looking for
opportunities to gain advantage over each other, to achieve the final step: hegemony

=> the HISTORY (OR THE PAST): the past have been more accordance with the predictions of
offensive rather than defensive. During the fist half of the twentieth century, there were two
world wars in which three great powers attempted and failed to gain the region hegemony:
Imperial Germany, Imperial Japan, and Nazi Germany. the second half of the century was
dominated by the Cold War, in which Usa and the Soviet Union engage in an intense security
competition that came close to blows in the Cuban missile crisis (1962).
Some defensive said that states that maximize power, they argue do not enhance their
prospects for survival, they undermine it.
[[[[[Defensive realists have to go beyond structural realism (fellback option) to explain how
states act in the international system (instances where great powers act in non-strategic ways).
They must combine domestic-level and system-level theories (foreign policy) to explain how the
world works:]]]]]]]

WHAT CAUSE GREAT POWER WAR?

Structural realists recognize that states can go to war for any number of reasons. But in
particular for:
1. Decrease their security
2. Ideology or economic considerations

THE POLARITY OF THE SYSTEM,

Polarity of the system (importunate the number of powers)
=> bipolarity(two great powers); multipolarity (three or more great powers)

=> bipolarity: After the second world war and ran until 1989; multipolarity: (state system was
multipolar from its inception in 1648 until the second world war ended)
>>>>>>>>>Peaceful? (20th century experience with cold war?).
For Europe, the cold war was the more peaceful than the other period as multipolarity. But also in
Europe there are period (1815-1853 / 1871-1915) of multipolarity and there were not wars.
Realists who think bipolarity cause less wars offer three important points:
1) more opportunity for the multipolarity (more powers); There are only two greta powers in the
bipolarity
2) bipolarity create an equal equilibrium (in multipolar system not);
3) there is more potential for mistake in the multipolarity (greater potential for miscalculation in
multipolarity, and miscalculation often contributes to the outbreak of war (identifying friends
from foes as well as their relative strength is more difficult)).
Balancing they said is more efficient in the bipolar system.
Not all realists accept that the bipolarity facilitate the peace. Someone said multipolarity is more
peaceful system. they based the idea in two considerations:
1) deterrence (fear) is more easier in the mutipolarity. There are more states that can join
together. In bipolarity there are not other balancing partners
2) less hostility among the great powers in multipolarity, because the amount of attention they
pay to each other is less than a bipolarity
With the end of the cold war some realistic think that there was a unipolar system. Other one
think for a multipolar system with china, Russia and India (we can see also the terrorism).

- Post-Cold War system???

1. Multipolar (Usa, China and China)
2. Unipolar (Usa): neither security competition nor war; just 1
Caveats: if the hegemon feels secure in the absence of other great powers and pulls most of its
military forces back to its own region. Security competition and maybe even war is likely to
break out in the regions it abandons
> large scales social engineering: POLITICS OF DISTANT REGIONS

BALANCED OR INBALANCED POWER (important is not the number of power)

Number is less important; how much power each of them controls> better explanatory variable
(preponderant power; number 1 and others)
Peaceful:
> little need to use force (war likely lesser greta powers)
>>Period between Napoleaons defeat in 1815 and status quo, the outbreak of the First War in
1914 > five wars between thre great powers > and none was a central war > consequence of
Britains commanding position in the international system (Naoleonic, France and Imperial
Germany, respectively, were woughly equal in power to Britain)
Conflict:
preponderant= potential hegemon
> it will not be satisfied with the
> when there is rough equality among the great power, no state can make a erious run at
hegemony X CENTRAL WARS
> France in the earlier eg. was a potential H

BALANCED OR IMBALANCED POWER

Power can be distributed more or less in the great powers. Some realists underlines how a
presence of an especially powerful state facilitate peace. Other one said that increase the
chance of war (central wars is when there is an especially powerful country). They said that in
Europe after the Napoleonic wars there was a long period of relative peace (not big wars).
Anyways not balanced multipolarity increases the risk of great power was
POWER SHIFTS AND WAR
1. Focusing on static indicators like the number of great power or how much power each control
X
Focus should be on the dynamics of the balance of power (changes that take a place in the
distribution of power)- the dominant state, knowing its days at the pinnacle of power are
numbered, has strong incentives to launch a preventive war against the challenger to halt its
rise. Of course, the declining state hast to act while it still enjoys a decided power advantages
over its growing rival.
The offence defence power: the rise of China according to offensive and defensive realism
POWER SHIFT AND WAR
The dominant state has a strong incentives to do a preventive war who want to take the
challenger to stop the rise. Germany in the two war worlds was the dominant power. But both
times it faced a rising challenger to its east: Russia before 1914 and The Soviet Union before
1939. To prevent decline and maintain the commanding position in the Europe, the Germans
launched the preventive wars in 1914 and 1939
THE OFFENCE-DEFENCE BALANCE
Some defensive realists argue that there is an offence-defence balance which almost always
favours the defence. As such, the balance is a force for peace. Some defensive realists are not
agree. Ad example in the Second War War the tank and the dive bomber shifted the offencedefence balance in the offence. On the other hand, there was no shooting was between the USA
and the Soviet Union during the Cold War, because the coming of nuclear weapon shifted the
balance in the defence. In sum, a variety of structural arguments attempts to explain when great
power war is more or less likely.
THE RISE OF CHINA ACCORDING TO OFFENSIVE REALISM
The ultimate goal of the great powers, according to offensive realism, is to gain hegemony,
because that is the best guarantor of survival. But it is really difficult to achieve the global
hegemony. The only that can hope is the regional hegemony. Today, US, the most powerful state
in the system, it is not a global hegemon.
Regional hegemon want to have the control in the region and control in the others areas. US has
gone to great to control Asia and Europe.
Also with the Imperial Germany (1900-18); Imperial Japan (1931-1945), Nazi Germany (19331945), and the Soviet Union (1945-89). In each case, USA played a key role in defeating and
dismantling those aspiring hegemony.
In offensive realism is correct that china become a regional hegemon in Asia. In particular, china,
want to maximize the power (Japan and Russia). China want to increase the power to pushed the
European great powers out of the Western Hemisphere in the nineteenth century. China will
make his own Monroe Doctrine. So China wants also a weak Japan and Russia in the same way
that USA prefers a military weak Canada and Mexico on its border. The USA does not tolerate
other competitors, as it demonstrated in the XX century. It is determined to remain the only
regional hegemon. . In the other way USA will work hard to contain China.
In the other way, it is clear how others states like India, Japan, Russia, as well as smaller powers
like Singapore, South Korea, and Vietnam, are worried about the rise of China. At the end, these
countries will join US to balance the power in the region.
THE RISE OF CHINA ACCORDING TO DEFENSIVE REALISM

In contrast to the offensive, the defensive are more optimistic about the rise of China. Defensive
realism provides reason to think that China should be able to coexist peacefully with the
neighbours and US. They will not make the same mistake of Bismarck, Hitler, etc.
This mean that China will not try to take the power as hegemony by violence, but they will try to
maximize its share of world power (more with cooperation and dialogue). Furthermore, the
presence of Nuclear weapons is another cause of optimism. It is difficult for any power to expand
when confronted by other powers with nuclear weapons.
India, Russia and the US have nuclear arsenal, and Japan would quickly go nuclear if it felt
threatened by china. These countries, which are likely to form the core of anti-China balancing
coalition, will not be easy for China to push around as long as they have nuclear weapons. In
shorts, nuclear weapons will be force for peace if China continues to rise.
The US experience in Iraq hel to China to understand that the benefits of expansion in the age of
nationalism are dangerous (costs and reputation).
Others structural realists think that the rise of china will be not peaceful because it mean the end
of the unipolarity. So the world became more dangerous. Furthermore Japan take nuclear
weapons, Russia , India continues to rise there will be more great power in the system. So in this
way increase the possibility of conflict.
Other said that bipolarity is more pacific than the unipolarity. Not all structural realists accept the
argument that bipolarity is more prone to peace than multipolarity. For them, a return to
bipolarity would be a cause for pessimism.
Other think that the situation would change if China will try to be powerful as Usa or maybe
more. Anyways, there is no consensus among structural realists about whether China can rise
peacefully. The only important point of agreement among them is that the structure of the
international system forces great powers to compete among themselves for power.
CONCLUSION
In 1990s someone think that the world becoming more peaceful and the realism was dead.
Others see as Western elites were for the first time thinking and talking about international
politics in more cooperative and hopeful terms (new approach).
After 11 September, the optimism disappeared and the realism come back again. Every realist
opposed to Iraq war that was a strategic disaster for Usa and Uk. Bu tin particular how
globalization undermined the role of the state. In particular with the born of nationalism (and
religion and ethnic problems).
Usa and Uk, the worlds two great liberal democracies have fought five wars together since the
Cold War ended in 1989.
In essence, the world remains a dangerous place, although the level of threat varies from place
to place and time to time. States still worry about their survival. International politics is still
synonymous power politics

The Rise of China Will Not Be Peaceful at All by John Mearsheimer Will China rise peacefully?
My answer is no. The China continue with the impressive economic growth and also for the next
few decades. Most of the neighbours of China, to include India, Japan, Singapore, South Korea,
Russia and Vietnam, will join with the US to contain China's power. He said that in the
international politics the states try to establish hegemony in their own region while making sure
that no rival great power dominates another region. The ultimate goal of every great power is to
maximise its world power and eventually dominate the system. The international system has
some characteristics. The important actors are states that operate in anarchy. All great powers
have some offensive military capability. Finally, no state can know the future intentions of other
states with certainty. The best way to survive in such a system is to be as powerful as possible,
relative to potential rivals.

Their ultimate aim is to be the hegemon, the only great power in the system but it is too hard to
project and sustain power around the globe. China (whether it remains authoritarian or becomes
democratic) is likely to try to dominate Asia the way the US dominates the Western hemisphere.
Specifically, China will try to maximise the power gap between itself and its neighbours,
especially Japan and Russia. China will want to make sure that it is so powerful that no state in
Asia has the wherewithal to threaten it. China will try to push the US out of Asia. We should
expect the China with its own version of the Monroe Doctrine. Beijing should want a militarily
weak Japan and Russia as its neighbours, just as the US prefers a militarily weak Canada and
Mexico on its borders. Furthermore, why would a powerful China accept US military forces
operating in its back yard? Why would China feel safe with US forces in ithe borders Why should
we expect the Chinese to act any differently than the US did? Are they more principled than the
Americans are? More ethical? Less nationalistic? Less concerned about their survival? They are
none of these things, of course, which is why China is likely to imitate the US and become a
regional hegemon.

[[[[[[[[[[[[[[[[[[[Structural realism differs for classical realism in one important aspect. The
survival of the State, through the conservation of territory and autonomy, is the primary goal of
the State. The ambitions of the State can only be released if the state survives. The Neo-realists
see the power as a mean to an end (i.e. survival) instead an end in and of itself. There is nothing
that states can do for prevent the threats, war and struggle for power.]]]]]]]]]]]]]]]]]]]

KENNETH WALTZ
=> Theory?
=> [theory collections of statements that propose causal explanations of phenomena and
meet the following three criteria 1) be internally consistent (the statements do not contradict
one another); 2) be logically complete (i.e. the hypotheses deduce from the theory should follow
logically form the assumption) of the theory; 3) must have falsifiable implications]
=> Waltz:
- theory cannot explain the accidental or account for unexpected events
Theory is depiction of the organization of the domain and connections among the part so by
defining the structure of international politics autonomy of the domain is made possible.
- Neorealism retains the tenets of realpolitik (political realism or practical politics, specially policy
based on power rather than on ideals).
- Marxists for instance link the outbreak of war to internal qualities of the state(governmental
forms, eco systems, social institutions, political ideologies).
- states with widely divergent economic institutions social customs, and political ideologies,
have all fought wars if an identified condition seems to have caused a given war, then why
would wars occur when their causes vary differently = until level explanations are not enough;
REJECT ANIMUS DOMINADI
- Both Unit- level and structural level- but more important is placement of units the system and
not by internal qualities of the units
- why different units will behave similarly (despite their variations) and produce outcomes within
expected ranges systems level understanding of theory / international politics
- why different units behave differently despite their similar placement in the system Uniti-level
/ foreign policy
ISSUES??
-Waltz sees international structure as an external joining of states as actors who have precisely
the boundaries, end, and self understandings that theorists accord to them on the basis of
unexamined common sense. Waltz grants this structure a life of its own independent of the

parts, the states as actors; and he shows in countless ways how this structure limits and
disposes action on the part of states such that, on balance, the structure is reproduced and
actors are drawn into conformity with its requisites. But how is the independence of this
structural whole established?
> NOTHING MORE THAN THE LOGICAL CONSEQUENCES OF THE PARTS TAKEN TOGETHER
- Politics in neorealism becomes pure technique: the efficient achievement of whatever goals are
set before the political actor. Political strategy is deprived of its artful and performative aspects,
becoming instead the mere calculation of instruments of control. Absent from neorealist
categories is any hint of politics as a creative, critical enterprise, an enterprise by which men and
women might reflect on their goals and strive to shape freely their collective well.
- SREUCTUAL LEVEL EXPLANATIONS
- Are destabilizing conditions within international system managed better in multipolar or bipolar
systems?
- 1) more powers; flexibility of alignment (the country one is wooing may prefer anther suitor or
on own alliance partner may defect)- limits a state options
- 2) Common interest negative reasoning i.e. fear of other states (Waltz argue that divergence
arises when positive interest are at stake; therefore in alliances among near equals strategies
will always be the product of compromises since interest of all partners / possible partners are
not alike)
- 3) If competing blocs are seen to be closely balanced- if there is a nun- in to compete at time
weakest link may determine the policy (even unwillingly you join war)
- 4) In alliances among equals = greater threat of defection = security of others is threatened.
Example: in 1956, the Suez Canal became the focus of a major world conflict. The Canal
represents the only direct means of travel from between Asia, the middle East, Europe, and the
U.S. Normally, free passage was granted to all who used the canal. but Britain and France
desired control of it, not only for commercial shipping, but also for colonial interest. The Egyptian
government had just been taken over by Gamal Abdel Nasser, who felt the canal should be
under Egyptian control
The United States and Britain had promised to give aid to Egypt in the construction of the Aswan
High Dam in the Nile. This aid was retracted
Egypt responded by sinking 40 ships in the canal, blocking all passage. The Unite Nations sought
to resolve the conflict and pressured the two European powers to back down. The rest of the
world shunned Britain and France for their actions in the crisis, and soon the UN salvage team
moved in to clear the canal. Britain and France backed down.. etc.
So for Kenneth WATZ:
- BIPOLAR: alliances leaders can design strategies primarily to advance their own interests and
to cope with their main adversary; less satisfy their allies
- MULTIPOLA WORLD: dangers are diffused, responsibility are unclear, possibility of calculation,
and son on.

- Miscalculation in multipolarity
v/s
- Overreaction in bipolarity
Which is worse?
[=> size of great power increase > lowers dependence > uninvolved in each others economic
affairs > this separation of interest reduces occasion for disputes]

Characteristic of Great Powers:

- Multipolar world:
1. interdependence of parties;
2. diffusion of dangers;
3. confusion of responses;
- Bipolar wordl:
1. self dependence of parties;
2. clarity of dangers;
3. certainty of whos to face them

UNIT LEVEL
- Bipolar world- competition is keen but manageable (US-SU long peace)
- Is that enough? (given the depth and extent of distrust- why werent they drawn into war)
- > Nuclear Weapons
- (self help is to provide security; why do states use force? => for security; then what if the latter
can be achieved without using force? i.e. by raising the costs of war nuclear weapons make the
implications of even victory too horrible to contemplate) => UNIT LEVEL CHANGE HAS
DRAMATICALLY REDUCED A STRUCTURAL EFFECT
ISSUES?
- Nuclear weapons are not relative but absolute weapons (conventional weapons are relative;
keep on comparing)
- Uneasy peace (how much is enough)
- Overlooks competence model = the power of an actor, and event its status as an agent
competent to act, is not in any sense attributable to the inherent qualities or possessions of a
given entity. Rather, the power and status of an actor depends on and is limited by the
conditions of its recognition within a community as a whole. To have power, an agent must first
secure its recognition as an agent capable of having power= by which the community confers
meaning and organizes collective expectations.

Waltz and neorealism

=> He created the neorealism (or structural realism, as he calls it), a theory of International
Relations which underlines the interaction of sovereign states can be explained by the pressures
exerted on them by the anarchic structure of the international system, which limits their choices
(the international system influence the behaviours of the countries). Neorealism thus tries to
explain recurring patterns in international relations, such as why relations between Sparta and
Athens are similar between the U.S. and the USSR in some important ways.
Waltz emphasizes a lots of time in this book and elsewhere that he doesnt t want to create a
theory of foreign policy, which tries to explain the behaviour or actions of a particular state at a
specific time or throughout a period.
Waltz argues that the world exists in a state of perpetual international anarchy. Waltz
distinguishes the anarchy of the international environment from the order of the domestic one.

In the domestic realm, all actors may appeal to, and be compelled by, a central authority 'the
state' or 'the government' but in the international realm, no such source of order exists.
The anarchy of international politics (its lack of a central enforcer) means that states must act in
a way that ensures their security above all, or else risk falling behind. This is a fundamental fact
of political life faced by democracies and dictatorships alike: except in rare cases, they cannot
count on the good will of others to help them, so they must always be ready to protect
themselves.
Like most neorealist, Waltz accepts that globalization is posing new challenges to states, but he
does not believe states are being replaced, because no other non-state actor can equal the
capabilities of the state. Waltz has suggested that globalization is a mode of the 1990s and if
anything the role of the state has expanded its functions in response to global transformations.
Neorealism was Waltz's response to what he saw as the deficiencies of classical realism.
Although the terms are sometimes used interchangeably, neorealism and realism have a number
of fundamental differences. The main distinction between the two theories is that classical
realism puts human nature, or the will to dominate, at the center of its explanation for war. While
neorealism does not consider a human nature the most important consequence of the behaviour
of the states but the pressures of anarchy (limit of the structure) tend to shape the result more
directly than the human nature of statesmen and diplomats or domestic governmental
preferences.
=> Neorealism underlines that the nature of the international structure is defined by its ordering
principle, anarchy, and by the distribution of capabilities (measured by the number of great
powers within the international system). The anarchic ordering principle of the international
structure is decentralized, meaning there is no formal central authority; every sovereign state is
formally equal in this system. These states act according to the logic of self-help, meaning states
see their own interest and will not subordinate their interest to the interests of other states.
States want to ensure their own survival as this is a prerequisite to pursue other goals.
This driving force of survival is the primary factor influencing their behavior and ensures states
develop offensive military capabilities for foreign interventionism and as a means to increase
their relative power. Because states can never be certain of other states' future intentions, there
is a lack of trust between states which requires them to be on guard against relative losses of
power which could enable other states to threaten their survival.
States don t trust each other, also for make alliances.
There are two ways in which states balance power: internal balancing and external balancing.
Internal balancing occurs as states grow their own capabilities by increasing economic growth
and/or increasing military spending. External balancing occurs as states enter into alliances to
check the power of more powerful states or alliances.
Neorealists contend that there are essentially three possible systems according to changes in the
distribution of capabilities, defined by the number of great powers within the international
system. A unipolar system contains only one great power, a bipolar system contains two great
powers, and a multipolar system contains more than two great powers.
Neorealists conclude that a bipolar system is more stable (less prone to great power war and
systemic change) than a multipolar system because balancing can only occur through internal
balancing as there are no extra great powers with which to form alliances. Because there is only
internal balancing in a bipolar system, rather than external balancing, there is less opportunity
for miscalculations and therefore less chance of great power war. That is a simplification and a
theoretical ideal.

NEW CLASSES

- The relationship between economics and political interaction at the state-level is far
more complex than any linear relationship can capture
- Interdependence is defined by the costs incurred by each state in a dyad to remove itself form
bilateral economic ties
- These costs of exit are in turn a function of the market in terms of the availability of
substitutable goods and buyers of goods, as well as adaptation costs associated with
restructuring the transactions required to satisfy economic demand.
- economic interdependence: function of the potential exit costs state incur by breaking
economies ties. These exit costs set apart interdependence for the other qualities of interstate
economic relations
> Factors governing exit costs can be found in the international system as well as internally with
each state
> systemic level: states are engaged in bilateral economic relationships within a global
marketplace. The available opportunities for states to pursue alternate sources for goods and
resources characterize the structure if the market
# A market than contains many suppliers and consumers for a good (grain)> highly competitive
environment, neutralizing the reliance of states upon each other
# A market with one of few suppliers of a good.

- This structural dimensions is complimented by and internal source of exit costs: asset
specificity
- Asset specificity > the degree to which an asset can redeployed to alternative users without
sacrifice of production value (williamson). As the assets that are involved in an economic
relationship become more specific to that relationship, the costs of terminating or altering the
terms of the relationship increase
- EXIT COSTS represent the difference between interdependence and more fungible economic
interaction
- mobility or resources- Rigid immobile resources make states vulnerable to trading partners.
Resources that are more fungible enable states to adapt to potential changes that other states
may threaten to impose.
- Market structure also determines the extent to which economic exit generates the need to alter
these factors of production. A states that incurs economic exit may have other potential partners
with which to establish new ties. s these alternative become scarce, current relationships
become more costly to break
- Exit costs are a function of market structure, asset specificity, and the level of economic
activity.

- Assets specify has reference to the degree t which an asset can be redeployed to alternative
uses and by alternative users without sacrifice of productive value. This has a relation to the
notion of sunk costs (BOEING)..

- Market structure dictates a states ability new market for its imports and exports. As alternate
trading partners become scarce, current relationships become more costly to break.

=> market structure that provides easily accessible substitutes will ameliorate any potential
costs of economic exit from trading partners
- (OPEC in the 1970s, asset specify explain why the US was forced to pay higher oil prices,
market structure explains why the US could not turn to other countries for its oil need; EQUALITY
trues for the MONOPSONY expected future markets / consumer demand. Us largest single
consumer market in the world)

- High levels of economic activity may not signal interdependence of both parties are able to
access new markets at home and abroad in the event of a disruption in trade. On the other hand,
low levels of economic activity may mask the existence of interdepence that driven by monopoly
or monopsony power
- Interdependence is distinguished form interconnectedness because it involves a mutual
dependence between states. If State A begins to trade with States B and begins importing oil,
ties of interconnectedness emerge. If States A begins to rely on the imported oil as a source of
energy to run its industrial economy, it..

- Economic interdependence exists when there are exit costs for any to states vis a vis their
economic relationship. These costs are a function of market structure..

- Hirschman & Keohane and Nye relative economic power asymmetry in interdependence
provides bargaining power in politics
- the blackmailers Fallancy: if a nation (nation B) would rather give in to a demand by another
nation (nation A) than suffer some form of punishment, then it is possible for a nation A to
successfully extract this demand by merely threatening nation B with the punishment.

- An exit cots threshold is the level of exit costs beyond which a player cannot endure the exit. It
sets a states limit fo the costs it is willing to bear in order to get (or hold onto) something that
another states has (or wants).
- This exit costs threshold..

- The relationship between a states actual costs and its exit cost threshold that determines
whether economic interdependence affects its strategy with respect to political conflict. Three
equilibrium emerge in his study, viz:
- When Chs exit costs are greater than its exit costs threshold but Ts exit costs are less than its
threshold then Ch is deterred from making a demand. This is the constraint equilibrium,
because Ch here is constrained by the economic relationship, and this argument is compatible
with the argument that economic interdependence reduces it from initiating a demand that leads
to conflict.
- When Ts exit costs are less than their exit costs threshold, Ch makes a demand and T
complies. This is the bargaining power equilibrium, as Ts level of interdependence affords
Ch bargaining power. Here the costs of exit for the Target allow the Challenger to induce the
Target t agree to its demands.
- When both players exit costs are less than their exit costs thresholds, then the conflict
escalates (the crisis/ escalation equilibrium). Here, the use of economic tools of persuasion
fails and militarized conflict ensues.

Exit Costs and Equilibrium Behaviour

Equilibrium
thresesold

strategy for challenger

case 1: constrained
ech

strategy for target

No Demand, Exit if Target Reject Reject if Challenger

Exit cost
e*ch>

Demands, Reject If
e*r > er
Challenges Exits
case 2: Barganing powe
e*r<er

Demand, Exit of target Reject

Comply if Challenger
Demands

case 3: escalation
E*ch>ech

Demand, Exit if Target Rejects

Reject if Challenger Demands,

Reject if Challenger Exits

er>er

I. neither state sufficiently interdependent (no bargaining influence, escalated conflict)

II. Target state sufficiently interdependent but not challenger(limited conflict)
III. Both states sufficiently interdependent (limited conflict)
IV. Challenger state sufficiently interdependent, but not Target, (no bargaining Influence, Status
Quo)

Actual Exit costs for target (er)

|
|

|
II

III
|

|----------------------------|-----------------------------------|
|
|

|
I

IV

__________________|________________________ Actual Exit Costs for Challenger (ech)

e*ch

- Case study: United states and South Africa during the apartheid era.
- United States never threatened to exit.

2. bargaining Power (Challneger can safety successfully make demads) / low level, non
militarized conflict challenger, Target acquiesces / Targets exit costs exceed its exit cost
threshold / China and US : technology transfer to china 1989 to present : challenger: China
target US / China is able to demand and get dual-use technology transfers from the US despite a

ban on military technology transfers imposed after the Tiananmen Square incident of 1898.
China uses .

ECONOMIC INTERDEPENDENCE AND CONFLICT

- WWI is not a particular compelling case example of failure for liberal trade theory, and it may
even indicate the strength of the liberal perspective
- WWI has been broadly misinterpreted, that interdependence did not really fail in 1914:
1. States that initiated the war were not interdependent
2. interdependent states were in most cases tepid joiners to an ongoing contest
3. Economic linkages served an important role in averting escalation to warfare
- Economic interdependence appears to have succeeded I averting war where nations were
integrated, but it was incapable of forestalling conflict where economic integration had yet to
occur
- Military alliance commitments
----[[[[[[[[ ECONOMIC INTERDEPENDENCE AND CONFLICT
interdependence theories:
third image:
- opportunity cost of war achieve gains more efficiently through economic means rather than
through warfare
- open financial and goods markets
second image:
-commercial peace or capitalist peace: interdependence mollifies the effects of states security
dilemmas by creating common interests and reducing uncertainty

=> interdependence defined as including trade, development, open financial markets and
monetary policy coordination- reduces conflcits by:
-aligning states interest, which gives them lesss to fight over;
- providing a mean of peacefully securing resources; and
- allowing states to foresee the costs of fighting, which facilitates bargaining and compromise

ECONOMIC INTERDEPENDECE AND CONFLICT

- for interdependence to promote peace, economic processes must either remove incentives for
states to engage in conflict or reduce the uncertainty states face when bargaining in the shadow
of costly contests
- interdependence makes it easier to substitute nonviolent contests for militarized disputes in
signalling resolve. States that process a range of methods of conflict resolution have less need to
resort to the most destructive (and costly) techniques
- Liberal dyads can damage mutually valuable linkages to communicate credibly. States without
linkages must choose between a very limited set of options, including more often- war

- Measurement and conceptualization

1. A groupd of coutnries is considered interdependent if economic conditions in one are

contingent on those found in others (inflation in one places upwards pressure on others prices) >
sensitivity
2. Those countries where it is constly to rupture/forego their relationship (OPEC and advanced
industrial countries) > VULNERABILITY
- (Difference lies in the costs borne BEST MEASURE WOULD BE INFORMATION ON
COUNTERFACTUAL SITUATION; e.g.: maybe sensitive; counterfactual can explain est)

- Asset specificity has reference to the degree to which an asset can be redeployed to altenative
uses by alternative users without sacrifice of productive value. This has a relation to the notion
of sunk cost (boeing: costs are so intense precisely because the capital and labor assets that go
into the operation of building planes are not fungible v/s SOYBEAN)
- Resources that are rigid in their relation to an international economic relationship make states
vulnerable to its trading partners. Resources that are more mobile or fungible enable states to
adopt to potential changes than other states may threat to impose.

- Markets structure dictates a states ability to find new markets for its imports and exports. As
alternate trading partners become scarce, current relanthioship become more costly to break.
Market structure that provides easily accessible substitutes will ameliorate potential costs of
economic exit from trading partners
- [OPEC in the 1970s; Assets specifity explains why the USA was forced to pay hugher oil prices,
markets structure explains why the USA could not turn to the other countries oil needs; EQIALLY
true for MONOPSONY expected future markets / consumer demand US largest single
consumer market in the world]
]]]]]]]]
- WWI is the example of the failure of economic integration to maintain international peace.
- Crisis of the interdependent states of West Europe lead to the WWI.
- The WWI go against the theory that economic integration maintain peace
- The WWI has been big misunderstanding, that interdependence did not really fail in 1914:
1. States that initiated the war were not interdependent
2. interdependent states were not really interdependent (who started the war not were really
interdependent)
3. Economic linkages served an important role in averting escalation to warfare (who were
interdependence did not have the war).
- We argue that the relationship between economic interdependence and the outbreak of World
War I has been not good interpreted and that interdependence did not really fail in 1914 (war
start with the less integrated states).
- The small crisis that lead to the war, created an incentive for
more integrated countries, most importantly Germany and Russia, to show an increasing resolve
to support their weaker, less interdependent, allies, Austria-Hungary and Serbia.
- Military alliance problems: the power of alliances fell to the country that it were less integrated
into the world economy. Economic integration was not capable to prevent the conflicts where
integration had yet to occur.
1. War and Interdependence
Theories of interdependence argue that economic relationships influence the conflict propensity
of states. Critics of interdependence argue that economic ties do not have powerful pacifying
effects on world politics. And other things that the interaction between states

Someone underline the interdependence create common interest, other underlines how
interdependence created security, but other underlines how war create an important resource to
increase the internal production (as Marx that see how the capitalism bring to the war => the
imperialism need to conquest). The ecnonomies interdependece create trade where one take
more than the other.
2 World War I as a Test of Liberal Theory
In the four decades prior to the Great War, Europe experienced a dramatic increase in the levels
of interdependence, especially among several of the major powers. Anyways Europe in 1914 was
not uniformly interdependence, but consisted of several highly interdependent powers, other
states that were minimally integrated into this system.

Existing uses of WWI to falsify the pacific effects of interdependence are methodologically flawed
for two reasons
> First, the fact that war occurred between interdependent states in one important case only
demonstrates that interdependence is not sufficient by itself to guarantee interstate peace;
interdependence could still reduce the overall likelihood of war
> Second, focusing on the outbreak WWI to test this theory is also problematic post hoc erg
propter hoc fallacy (also selection bias, using one case to test a general hypothesis about factors
that tend to lead to particular outomes, rela life exmaples?)
(when it is concluded that one event causes another simply because the proposed cause
occurred before the proposed effect > a causes or caused B because A occurs before B. I
sneezed at the exact same time an earthquake started in California ( there is no reason to
suspect any causal connection between the two events)

- What makes the outbreak of World War I relevant to theories of interdependence is not just that
it was a war, but that is was a war that involved several powers that were formerly highly
interdependent. The war did not begin among the most interdependent states in Europe but
instead among their less interdependent allies.
=> there was not a direct war between Germany and Russia or France. The war started in the
Balkans (Austria-Hungary and Serbia) but supported with the others countries
As we demonstrate, crises among the highly interdependent powers, most importantly Britain,
France, Germany and Russia, were generally resolved peacefully during this era, despite
important differences among these powers. By contrast, crises among the less interdependent
powers of Europe in this period often led to war.
3. Interdependence in Pre-World War I Europe
It is possible to think of Europe during this era as consisting of two distinct economic
subsystems. The first is a highly interdependent group consisting mostly of Western powers,
most importantly Germany, France and the United Kingdom, but also Russia. The second
subsystem is a significantly less interdependent group of Eastern European states, including the
Ottoman Empire, its successor states and again Russia.
Scholars generally agree that between 1871 and the beginning of World War I many European
powers became increasingly economically interdependent, particularly in terms of increased
trade and capital mobility. The highly interdependent states in Europe were mostly in the West,
including France, Britain, Germany, Belgium, Holland, Norway, Sweden and Denmark. Other
powers, such as Italy, Austria-Hungary and Russia were significantly less developed economically
and less integrated into the global economy, although Russia was heavily dependent in
economic terms on the Western powers.
The less economically integrated and developed of the European powers at the time were the
Ottoman Empire and its various successor states, as well as the Iberian states. The key Western
powers of Britain, France and Germany constituted a highly economically interdependent group
to which Russia was also attached. Austria-Hungary was connected to this group, largely via its

economic relations with Germany, but its economic ties to other Western nations were far less
significant.
4. European Crises 1871-1913
Wars often appear inevitable in retrospect, but few wars seemed more unlikely to
contemporaries in the preceeding years than World War I. It is still important to remember that
the Great War did begin in the Balkans. But the war became large with the enter of the major
European powers. But if someon ewant to understand why started the war they have to see on
Serbia and Austria-Hungary. In the same era that disputes tended to be peacefully resolved in
the West.
4.1 The Highly Interdependent Subsystem
The late nineteenth and early twentieth centuries in Europe were marked by considerable
tensions and a number of crises, including crises both between states that were highly
economically interdependent and between those that were not economically interdependent.
Three major sources of tension were at the root of these crises, and each was characterized by
changes in the balance of power.
1. The first source of tension was Germanys occupation of Lorraine and (to a lesser degree)
Alsace, both captured from France during the Franco-Prussian War.
2. A second source of tension involved the competing colonial ambitions of the major powers.
Few territories were left to conquer, even as Germany increased its drive for colonial expansion
after unification.
3.Finally, after decades of decline, the Ottoman Empire not have the capacity to maintain
dominance over its European possessions. This, and the accompanying rise of Balkan
nationalism, threatened not only Turkeys interests but also those of the other powers in the
region, especially Austria-Hungary and Russia.
=> Changes in the balance of power, and the competing ambitions associated with them, led to
frequent clashes among European states, but these disputes generally did not escalate to war
when conflicts involved states that were economically interdependent.
The tension of the three power (France, Germany and Grain Britain) a were in many field
(economic, territorial, colonial, etc.). But no one of them caused a war. The controversy were
resolved in a pacific way. There are all possibilities for a clash with the great powers (from 1870
to 1914) => but all resolved in a pacific way.
4.2 The Weakly Interdependent Subsystem
In the other way we can see how as weakly the interdependent subsystem. We analysed before
the question about Balkan(decline o Ottoman, etc.). Furthermore Russia generally supported the
rise of Balkan nationalism because (1) Russia had a long-time rivalry with Turkey and ambitions
for access to the Mediterranean; and (2) pan Slavism was increasingly influential in Moscow. The
multi-national Austria-Hungary, however, was threatened by rising Balkan nationalism, and faced
a security dilemma especially with respect to Serbia.
Lacking the commercial incentives to cooperate as the relations in the West, the Eastern nations
have nothing to loose with not economic relations. As we discuss after that, the strategic game
between the integrated powers became increasingly like Chicken rather than the more
traditional Prisoners Dilemma.

Game theory: Chicken?

Games of chicken: example missile of Cuba
Siam and France
- Highly interdependent (west) France, Britain, Germany, Belgium, Holland, Norway, Sweden and
Denmark

1. Germany and France remained peace for over forty years after the treaty of Frankfurt, despite
specific plans for invading each other Germany, the Schlieffen Plan, and France Plan XVII;
Germany finance of iron mining in the French region of Longwy-Briey; France-Britain overs siam;
Russian-Britain; Britain-Germany
2. Significantly less interdependent (East)- Russia, newly unfiled Italy, ad Austria-Hungary even
less so
3. Iberian and Balkan Peninsula were minimally interdependent (rapid decline of the Ottoman
Empire, which, accompanied by the rise of nationalism in the region, led many Balkan nations to
seek interdependence)
4. General absence of a positive motive for peace. Lacking the commercial incentives to
cooperate
- Tightening alliance commitments > foreign policy was increasingly, handed over to local
officials> under the alliance system
- WW1 does not demonstrate that interdependence failed, but rather demonstrates that other
variables (also operating in a probabilistic manner) can increase and put in dangerous the
interdependence.
- There is the variables of the system of European alliances, the incentives of leaders to limit
their options during crisis situations, and the decisions of individual leaders to honour their
alliance commitments (Russia and Germany decided to defend their alliances commitments,
which bring to a interdependent states into a conflict begun by the non-interdependent states)
- European states that remained neutral, it is worth noting that among these were Netherlands,
Norway, Sweden and Denmark, all highly interdependent states.
- Concluding remark:
1. If interdependence did not reduce conflict, where would we have expected conflict during the
era leading up to the war??
2. War spread to the interdependence powers because of intervening factors that nullified the
pacifying effects of interdependence
=> As the analysis the rivalries among Germany, Britain and France were the most intense of
the period. During the period of greatest commercial expansion, interdependent powers were
less likely to go to war, also when they had the means and the motives to do so
We must ask why World War I began among the minimally interdependent powers and not in the
West.
..

09/04/2015
- Existing argument about economics and peace. They show how capital interdependence
contributes to peace independent of the effects of trade, democracy, interest, and other
variables.
We survey work in four areas: the democratic peace, and trade, capital, and monetary
interdependence.
- THE DEMOCRATIC PEACE: liberal policies rarely fight each other though appearing about as
likely to engage in disputes generally. Democracies behave differently toward each other than
toward non-democracies (democratic institutions may constrain leaders, domestic audience or
opposition groups force the revelation of private information, etc)
- TRADE INTERDEPENNCE: Trade Interdependence Democratic peace research was inspired by
the Kantian prophesy of a perpetual peace,but Kants recipe(often calledtheliberal peace)
consists of much broader conditions, including republican government, a league of nations, and
common markets. Many believe thta Interdependence has a greater effect than democracy,

growth, or alliances for the conflicts. In particular because they don t want to lose the interest
and the benefit that they have
- MONETARY INTERDEPENDECE: monetary interactions can be a source of interdependence.
interstate monetary relations can be characterized by intermittent cooperation, competition, and
coercion. Although they reduce state autonomy in monetary policy making, higher levels of
monetary dependence raise the incentives to cooperate
- CAPITAL INTERDEPENDENCE: trade is only one manifestation of the global spread of capitalism.
Since capital markets dwarf (schiacciano) the exchange of goods and services, firms should
weigh the risks of investment much more heavily than trade. Globalization has increased capital
mobility and monetary cooperation even as its redefines the terms on which state compete
(interdependence may even transmit economic crises- thus, the literature suggest that
interdependence could increase conflict between states while decreasing the chances of violent,
militarized behaviour).
- Opportunity costs associated with economic benefits generally cannot deter disputes. Instead,
interdependence create means for states to demonstrate resolve without resorting to military
violence
- Notion of interdependence SHOULD involve aspects of economic activity besides trade
- Other macro-political aspects of international economics- such as the need for monetary policy
coordination are also omitted in previous studies of interdependence
Theory: economic interdependence and peace
Why states fight: a theory of costly contest
Explanations for war are legion. However, work by James Fearon underlined how theories of war
they do not account for the behaviour of interest
- Costly contest involve at least two elements.
First, there is zero sum competition for an excludable good. States differ over issued or territory
that each cannot possess simultaneously.
Second, states choose a settlements method. The choice of method is non zero sum.
Transaction costs deprive winners of benefits and increase the burden for losers so that all
are better off selecting methods that minimize costs. Since war expensive, fighting makes sense
only if equivalent settlements cannot be obtained using cheaper methods. A theory of war, then,
explains why efficient settlements are at times unobtainable ex ante
- States posses private information about strategic variables (capabilities, resolve, and so on). If
states could credibly share private information, efficient ex ante bargains could be identified
- Instead, uncertainly provides weak or unresolved state an opportunity to conceal weakness
even as competition creates incentives to bluff. States pool, claiming to be resolved and
capable regardless off their trues nature. Such cheap talk claims do not allow observes to
differentiate resolved or capable opponents from the weak or unresolved
- Only by imposing costly contest by fighting or similar acts- can states distinguish resolute
opponents from those seeking to bluff. States fight largely because they cannot agree or
bargains that each prefers to what each expects to obtain from fighting. If states can agree
about the nature of eventual settlements, then there is always some mutually preferable bargain
- Why some states do not fight: contributions of interdependence to Peace
- Uncertainty about the allocation of spoils from the contest accounts for the contest
itself
- Conventional descriptions of interdependence see war as less likely because states face
additional opportunity costs for fighting. The problem with such an account is that it ignores
incentives to capitalize on an opponents reticence to fight. If an opponents(B) is reluctant, then
state A can make larger demands without risking war

- Imagine that two states compete over a sum of money (say 100$; assuming that states have
equal chances of victory)
- COSTS for fighting (20$); winner gets all the money (- costs) and the loses gets nothing (costs)
- EXPECTED value of fighting = (0.5 (100$) + 0.5 (0$) 20$)= 30$
- If states are risk neutral, then any offer yielding (cedendo) each side at least 30$ is at least as
valuable as fighting. Negotiated settlements form (31$, 69$) to (69$, 31$) are available and
preferred to war
- Supposed instead that costs remain 20$ for one state (A) but that the other state (B) has
private information about its costs (C). Suppose that war costs for state like B range from 0$ to
40$. Obviously, if Bs costs are high then A can make a demanding proposal. B thus has an
incentive to bluff. A in turn recognizes B will claim low costs whether or not Bs costs are modest.
A thus cannot infer anything meaningful from Bs cheap talk claims. Types B with lowe than
average costs fight, whereas cost type B accept A's offer.
=> Fearons reassessment renders a finite a set of necessary conditions for costly contests.
States must have incentives to compete. This first set of conditions is widely recognized and is
referred to by several labels (opportunity and if the want, capability and resolve, probability and
utility).
Why
- Interdependent dyads may avoid costly contests if economic linkages decrease the expected
value of competition to the point where one party prefers conceding to competing (costs
between 50-90 USD over a 100 Dollar hypothetical conflict)
- Say for instance, interdependence dyads derive some benefits form economic linkages (h, say
h= 10$). If A and B avoid fight, then each receives the settlements plus the benefit
- = (100$ - d + 10$ and d+ 1$, respectively)
- Bs war costs are again between 0$ and 40$. Conventional explanations for interdependence
identity the fact that B receives (d+ 10$) instead of (d) for accepting As demand as leading to
peace. Since A is not ignorant of its own interdependence with B. As best offer is one that B just
prefers to a fight. Since benefits increase under interdependence-.
- States fight largely because they cannot agree on bargains that each prefers to what each
expects to obtain from fighting. If states can agree about the nature of eventual settlements,
then there is always some mutually preferable bargain. NECESSARY CONDITIONS FOR COSTLY
CONFLICTS:
* states must have incentives to compete. This first set conditions is widely recognized and is
referred to by several labels (opportunity and willingness, capability and resolve, probability and
utility).
* Costly contests only follow when states are also uncertain about likely consequences of
contests. The second set conditions requires that states possess private information..

- For interdependence to promote peace, economic processes must either remove incentives for
states to engage in conflict or reduce the uncertainty states faces when bargaining in the
shadow of costly contest
- Interdependence makes it easier to substitute non violent contest for militarized disputes in
signalling resolves. states that possess a range of methods of conflict resolution have less need
to resort to the most destructive (and costly) techniques. Liberal dyads without linkages must
choose between a very limited set of options, including (more often) war. The conflict model with
uncertainty shows why this is so.
- Recall that As best response is an offer that an opponent weakly prefers to fighting. If the
opponent ( B) has private information about its war costs( c), then As optimal offer derives from

a rational guess (the distribution of reservation prices for different types of player B). A
calculates its offer as the best demand it can make to each opponent weighted by the odds that
a given opponent type is the actual adversary. Players B whose war costs are high accept,
whereas those with low costs fight.
Conventional descriptions of interdependence see war as less likely because states face
additional opportunity costs for fighting. The problem with such an account is that it ignores
incentives to capitalize on an opponents reticence to fight.
- Economic interdependence can motivate peace in two ways:
First, conflict may occasionally be so expensive relative to the expected value at for fighting
that states prefer any offer rather than enduring a contest;
Second, instead of deterring conflict interdependence can convey credible signals, obviating the
need for costly military contests. Actors behaviours potentially inform observers about the value
of strategic variables, dissipating private information. War is less often necessary when states
possess nonviolent methods that credibly inform.
How interdependence functions in the context of politics
The task remaining is to link conflict behavior(or its absence) to economic activity. Economic ties
between states may be portrayed as lying along a continuum from pure autarky(closed
economies)to perfectly integrated(one economy). t makes no sense to discuss the role of
interstate economics under autarchy. Instead, for economies that are not closed, we must
delineate the channels through which states are interrelated. We distinguish between market
interactions and policy interactions.
Capital interdependence promotes peace by allowing states to engage in costly signaling and
reducing the need to resort to violence to obtain settlements.
- Integrated economies: markets interactions and policy interactions
- Policy interactions:
1) states must be able to obstruct economic benefits; benefits must generally be jointly
contingent (soloamputeee);
2) capital markets are particularly vulnerable to intervention (POL SHOCKS; costly signalling);
monetary policy coordination (BRI, FR, US- suez crisisi)
- Opportunity cost cannot alter the probability of costly contests. Instead, a willingness to
endure costs in pursuit of political goals demonstrates resolve and informs opponents
The Dependent Variable
The dependent variable is the onset of a militarized interstate dispute (MID), coded 1 for any
dyad year in which a threat, display, use of force or war begins, and zero otherwise (including
the subsequent years of a multi year dispute).
a. Measuring Monetary Interdependence
A state may peg its currency to a precious metal or a foreign currency, engage in a cooperative
arrangement with a group of other countries to maintain its exchange rate within a certain
band, or float the currency to allow the market to determine its equilibrium exchange rate.
b. Measuring the impact of capital investment
Capital seeks higher risk-adjusted returns. Risk is contingent on government restrictions, the
degree of domestic capital market integration into world markets, and the overall exposure of
the economy to direct investments.
Conclusion
We have reviewed arguments for the effect of economic interdependence on peace. We show
that existing accounts do not adequately explain why liberal economies are less likely to fight,
but that a signaling argument is consistent with the observation of a liberal peace. We also
expand interdependence to include financial and monetary integration, offering a set of variables

that measure these processes. Our results corroborate our hypotheses. They analyse an
important points between economics and peace.
Trade and direct investment increase cross-border economic contact and raise a states stake in
maintaining linkages. Monetary coordination and interdependence demand that states strike
deals. Through such interactions, states create a big set of mutual beneficial economic linkages.
While these linkages may deter very modest clashes, their main impact is as a substitute
method for resolving conflict.
Political shocks that threaten to damage or destroy economic linkages generate information,
reducing uncertainty when leaders bargain. Threats from interdependent states carry more
weight than threats from autarchic states precisely because markets inform observers as to the
veracity of political cheaptalk.

13/04/2015
Anybody realist?
- The central problem is that theoretical core of the realist approach has been undermined by its
own defenders in particular the defensive and neoclassical realists who seek to address
anomalies and defect. The result in an approach less distinctive to realism. => Ad example with
Waltz. The consequence is that the definition is more large. The realist rubric now are the entire
universe of international relations theory (in- cluding current liberal, epistemic, and
institutionalist theories) and excludes only a few intellectual scarecrows (such as irrationality,
and so on)
- Debates among realist, liberals, epistemic theorists, and institutionalists have traditionally
centered around the scope, power, and interrelationship of variation in material capabilities
(realism), national preferences (liberalism), beliefs (epistemic theory), and international
institutions (institutionalism) on state behaviour.
Theoretical Paradigms
Whether a paradigm is conceptually productive depends on at least two related criteria,
coherence and distinctiveness
Realism coexists in a theoretical world with at three paradigmatic alternatives for which core
assumptions can been elaborated:
- institutionalist paradigm: contains theories and explanations that stress the role of international
institutions, norms, and information. Examples include the transaction cost-based analyses of
functional regime theorists and, perhaps, the sociological institutionalism espoused by some
constructivists. (Keohane)
- liberal paradigm, contains theories and explanations that stress the role of the state in the
transnational state-society relations. "second-image" theories. Examples include claims about
the autonomous impact of economic interdependence, domestic representative institutions, and
social compromises concerning the proper provision of public goods such as ethnic identity,
regulatory protection, socioeconomic redistribution, and political regime type. (Moravcsik, Doyle,
Keohane and Nye).
- The third less well-articulated alternative, the epistemic paradigm, contains theories and
explanations about the role of collective beliefs and ideas on which states rely in calculating how
to realize their underlying goals. Examples include many arguments about culture (strategic,
organizational, economic, and industrial), policy paradigms in particular issue areas, group
misperception, standard operating procedures, and some types of social learning. (Legro,
Goldstein, Katzenstein)

=> Realism as a Paradigm:

Many forms of realism lack both coherence and distinctiveness. But to see this, see first
demonstrate a coherent, distinct formulation of the core assumptions underlying the realism
paradigm. So we analysed three assumptions:
1. The nature of the actors: Rational, unitary political units in anarchy:
2. The nature of state preferences: Fixed and uniformly conflictual goals: but, (1) does not deny
that in a world politics zero-sum conflict nearly always coexists with positive-sum conflicts, (2)
does not exclude most variants of so-called defensive realism, in which states are assumed to
have a preference for security. State preferences are only on average conflictual. (3) only
preferences are fixed and conflictual, not resulting state policies and strategies or strategic
outcomes.
3. International structure: the primacy of material capabilities: this permits variation in world
politics. A state's influence is proportional to its underlying power, which is defined in terms of its
access to exogenously varying material resources. This assertion, above all else, distinguishes
realism from liberal, epistemic, and institutionalist explanations, which predict that domestic
extraction of resources and interstate interaction will vary not with control over material
resources, but with state preferences, beliefs, and information.
The Degeneration of Contemporary Realist Theory
Most recent realist scholarship-notably that of "defensive" and "neoclassical" realists-flatly
violates the second and third premises.
Minimum Realism in Theory
Minimal realists seek to define a distinct and coherent realist paradigm with reference to a set of
assumptions less restrictive than the three we outline above. Agreement on Anarchy is nearly
universal, so this does not distinguish realism. Two additional assumptions of 'minimal realists'
are common:
1. First, states seek to realize a fixed set of underlying preferences thta go from defending their
territorial integrity and political independence to expanding their influence over their
international environment (often referred to, somewhat misleadingly, as "security" and "power,"
respectively).
2. Second, the states use the political means to resolve the resulting conflicts, force and the
threat of force. Nearly all the authors considered in this article base their discussion of realism on
such a definition, even when some fail to make this explicit.
But these two points not distinguish the realism because the nearly all variants of liberal,
epistemic, and institutionalist theories share the same three assumptions.
Other Theories Subsumed in Realism
Increasingly, realist research invokes factors extraneous, even contradictory, to the three core
realist assumptions, but consistent with core assumptions of existing nonrealist paradigms. This
degeneration takes three distinct forms, depending on whether realists invoke exogenous
variation in preferences, beliefs, or international institutions.
1. From Realism to Liberalism: Power is What States Want it To Be: The domestic
institutions, economic interests, and collective values could play a role. Examples: Jack Snyder,
Joseph Grieco, Fareed Zakaria, Randall Schweller, and Stephen Van Evera. Most of these are in
fact liberal theories. Efforts to define realism by reference to intellectual history in general, and
classical realism in particular, are deeply flawed.
2. From realism to Epistemic Theory: Power is What Sates Believe it To Be: If the
perceptions and beliefs about effective means-ends calculations of states, given adequate
information, consistently fail to correspond to material power relationships, then power is at best
one of a number of important factors and perhaps a secondary one. The parsimony and
coherence of realist theory is eroded. When recent realists theorize this relationship explicitly,
moreover, they are forced to borrow propositions more fully elaborated in existing epistemic
theories, which theorize the influence of societal beliefs that structure means-ends calculations

and affect perceptions of the environment. Example from Walt (balance of threat) and Wohlforth
(end of cold war).

3. From Realism to Regime Theory: Power is What States Agree It To Be: Recent realist
theory not only treats international institutions as autonomous forces in world politics, but at
times views their impact as far stronger, if also far more ad hoc, than does conventional regime
theory The tendency of recent realists to reverse this causal mechanism not only undermines
realism's coherence and distinctive- ness, but is ultimately parasitic on existing regime theorynot least because realists have yet to offer a distinctive theory of why international institutions
influence state behavior. Examples are Grieco (european monetary integration) and Glaser
(signalling and arms control)
Practical Advantages and Broader Implications: Why Reformulate Realism?
Adherence to our reformulation would facilitate:
- more decisive tests among existing theories,
- define more sharply the empirical domain of realist theory,
- and provide a superior foundation for multicausal synthesis between realism and other
theories.
The mislabeling of realism has obscured the major achievement of this research in the 1990s,
namely to demonstrate in important areas of security studies the explanatory power of liberal,
epistemic, and institutionalist theories.
Conclusion
By this standard, the realist paradigm is degenerating. Its conceptual foundations are being
stretched beyond all recognition or utility. Realism has become little more than a generic
commitment to the assumption of rational state behavior. One result is a variation in national
preferences, beliefs, and international institutions.
From the perspective of the realist paradigm with which we began this article, we ask, Is
anybody still a realist? From the perspective of minimal realism the question becomes: Is
everybody now a realist? Either way, realism is in need of reformulation.
A commitment to realism should signal far more than a belief in state rationality and
international anarchy. It should mark a commitment to a particular rationalist theory of state
behavior in anarchy, one stressing the resolution of international conflict through the application
of material power capabilities.
otro summary
Realists tend to pride themselves upon the parsimony of their theories, but in Is Anybody Still a
Realist, Jeffrey
W. Legro and Andrew Moravcsik argue that realists have abandoned the elegance of explanations
based on the distribution of material resources. Instead, many realists have attempted to
subsume their critics by looking to changes in state preferences, beliefs and international
institutions as explanations for state behavior, and even privileging these explanations over
material power. Legro and Moravcsik describe the rise of a minimal realism, based on
assumptions of anarchy and rationality, and reliant upon explanations outside of realism. They
assert that realism, properly constructed, ought to stack up distinctively against three alternative
paradigms in particular: the institutionalist, liberal and epistemic paradigms. In turn, they discuss
the three core assumptions that unify realist thinkers.
- The first assumption is about the rational and unitary nature of political actors (for our
purposes, states), who pursue goals in anarchy. Rationality in their characterization implies the
choice of the most efficient means to designated ends, in the face of uncertainty and incomplete
information.
- The second assumption is that states have fixed and uniformly conflicting goals. This is your
standard picture of black balls competing in a zero-sum environment over scarce goods.

According to Legro and Moravcsik, this does not exclude bargaining and positive-sum
interactions, although realism may only be relevant to the distributive aspects of such situations.
Legro and Moravcsik also emphasize that conflicting preferences do not necessarily imply
conflicting state policies or strategies, and that the realists see the fundamental problem of
statecraft as manag[ing] conflict in a world where state interests are fundamentally opposed,
(16). The third core assumption of realism, which truly marks off realism from other paradigms,
is that outcomes in international relations are a function of the relative cost of threats and
inducements, which is directly proportional
to the distribution of material resources, (17). Having discussed what they believe realism
should be about, Legro and Moravcsik cast aspersions on recent work that calls itself realist,
especially targeting defensive and neoclassical realists. They begin by discussing minimal
realists, including Joseph Grieco, who claim that assumptions of rationality and anarchy are
enough to derive state interests in maximizing relative gains in the realms of security and
autonomy and the ability of the state to do so via material power. Legro and Moravcsik claim
that rationality and anarchy do not distinguish realism from other paradigms, and that relativegains-seeking behavior in a competition for goods on the basis of material power do not
necessarily follow from the two assumptions. Therefore, other realists have added to minimalist
assumptions. Most commonly, states fall into a range of fixed preferences that range from
defense of territorial integrity and political independence to the expansion of political influence
over the international environment (shorthand for the former end is security, while shorthand
for the latter end is power). Additionally, the threat and use of force are two primary
strategies. But even these extensions do not tell us anything about how international conflicts
are resolved, and why they arise in the first place. Legro and Moravcsik tell us that the recent
realist work attempting to answer these questions has increasingly resorted to explanations
based in liberal, epistemic and institutionalist theories. For instance, realists have made much of
the varying preferences among states for hostile (revisionist) and status quo behavior. According
to Legro and Moravcsik, identifying variation in these preferences forces scholars to treat
preferences as a dependent variablethis is already a departure from the realist assumption of
fixed preferences. Moreover, explanations for this variation draw upon state-society relations,
culture, and various other non-realist traditions of thought. To make their case, Legro and
Moravcsik sample recent realist work. They begin with Jack Snyder, whose explanation for
overexpansionist behavior is, in their view, rooted in domestic politics. Next, they turn to Joseph
Grieco, who treats concerns for relative gains as variable on the basis of history, the other
states reputation for exploitation, the relationship with the other state, and other factors. Like
defensive realists who treat preferences as variable, neo-classical realists (NCRs) are also
interested in the variation between states in their tendency towards status quo and revisionist
behavior. Legro and Moravcsik argue that this consigns NCRs to liberal discussions of domestic
politics, ideas, and interests. Moravcsik turns to his friend Fareed Zakaria, who explains varying
degrees of expansionist behavior in part on the states ability to extract resources from society.
Next, Legro and Moravcsik consider Randall Schwellers explanation of changing state behavior
on the changes in state preferences, to which a state adjusts its power. Finally, they critique
Stephen Van Everas story of varying preferences because it is rooted in the actions of elites,
bureaucracies, militarism and nationalism. In other words, while realists are supposed to
(according to Legro and Moravcsik) hold state preferences to be fixed and exogenous, Devarati
Ghosh IR Working Group 3 December 1999 NCRs and defensive realists vary state preferences
on axes of domestic politics, structures and actors. They thereby deprive realism of the
parsimonious elegance that also distinguishes it from other paradigms of international relations.
Also depriving realism of its parsimonious elegance are the middle range realists who underscore
the importance of beliefs and perceptions of power (in the tradition of the epistemic paradigm),
rather than objective power. Once objective power as an explanation for state behavior becomes
captive to perceptions, scholars turn increasingly to epistemic, institutional, and liberal
paradigms. For example, Stephen Walts well-known balance-of-threat theory relied on state
perceptions of others intentions, a move which, according to Legro and Moravcsik, excludes very
little as an explanation for rational balancing. Additionally, Walts examination of the causes of
variation in perception reflected preferences or strategic beliefs and perceptions, both of which
are not a part of the realist paradigm. William H. Wohlforth argues in a similar vein that
perceptions of power shape state behavior. Legro and Moravcsik critique the four factors that
Wohlforth identifies as causes for the timing of the sudden Soviet perception of decline in the
late 1980s that, in his view, brought the Cold War to an end, (39). Legro and Moravcsik cast the
four factors, that is, the scientific-technical revolution, a shift in perceptions and ideas of the

Soviets and Americans, and the symbolic impact of the revolutions in Eastern Europe, as various
forms of nonrealist approaches. Some recent realist work has apparently also gone
institutionalist on us. Joseph Grieco, for example, characterizes the European Monetary Union
(EMU) as an instrumental use of an institution by a coalition of weak states to transfer power. In
other words, states apparently disadvantaged in the distribution of power were able to use an
institution to transform the distribution of power. The distribution of power becomes, in Griecos
story, variable in a way that Legro and Moravcsiks realism would not admit. Charles Glaser goes
even further in describing institutions as a means of alleviating misperceptions about the
preferences of other stateshe draws on functional theories of international institutions, and
casts them as consistent with realism, because he does not violate the assumptions of egoism
and anarchy. Legro and Moravcsik believe that Glaser has simply remade Keohanes functional
argument and called it realist, and question what has been gained by such an endeavor. Having
made their case that realism has degenerated, Legro and Moravcsik defend their position that
distinguishable paradigms are meaningful. Essentially, they argue for a more conscientious
organization of IR debates along the assumptions made and hypotheses generated, in an effort
to avoid confusion due to mislabelling. Legro and Moravcsik contend that the empirical research
can be fruitfully aimed at distinguishing between the causal importance of the distribution of
material resources, the distribution of preferences, the distribution of beliefs, and the distribution
of information, which line up more or less with the realist, liberal, epistemic and institutional
paradigms, respectively. This would help clarify explanations of imperialism, alliances,
cooperation, war and peace, and hegemony. Legro and Moravcsik also urge the delimitation of
realism to circumstances in which states are motivated by strong and symmetrical underlying
conflicts in preferencesoverlapping territorial, economic, or ideological claimsor situations
where the cost of coercion is so low (at least to one party) that its cost-effective use is feasible,
(49). Of course, Legro and Moravcsik are at pains to assure everyone that they think realism is
important to the study of international relations, and thereby present their characterization of
the complementarities among paradigms. Specifically, preference and belief formation is more
the locus of epistemic and liberal explanations, whereas the logic of strategic interaction among
states is more the realm of realist and institutional explanations. Research done in this vein will
naturally require greater knowledge of the specifics of a particular situation. It is in the empirical
testing that realism has often come up short, but Legro and Moravcsik argue that this is no
justification to re-cast international relations as a debate between realists and idealists.
Naturally, Legro and Moravcsik prefer the rise of healthy debates among various rational
theoretical strandsliberal, epistemic, institutionalist, and, of course, realist paradigms.

proff classe questo

- Trend 1: minimal realism theory
- (although it is trues liberals and epistemic theorists focus on contestation among subnational
actors in the process of preference or belief formation, they generally hold that they act
rationally)
- Explanations under this inevitably import considerations of exogenous variation in the societal
and cultural sources of state preferences, thereby sacrificing both the coherence of realism and
appropriating midrange theories of interstate conflict based on liberal assumptions

- Jack Snyder imperialism: small rent-seeking groups can profit at the expense of diffuse
constituencies a generate tendency exacerbated by deliberate manipulation of ideology and
logrolling among cartelized interest groups
- Joseph Grieco on relative gains: relative gains seeking definition of realims lacks theoretical
coherence and distinctiveness there is nothing distinctly realist about relative gains seeking
per se
- Neoclassical realism: theoretical indeterminacy and a reliance on exogenous variation in state
preferences

- Fareed Zakaria on 19 centruy America: the tendency of states to expand is a function of the
international and domestic power of state. Both, he contends, were necessary for late-19 century
US expansion. Insofar as states are infleucned by relative power and can ust societal support for
their policies, they explit opportunities to wield influence
- He frequently invokes mutual recognition among liberal republics, economic modernization,
public unwillingness.

- Randall Schweller on interwar foreing policy: Germanys leap from lesser power to major power
pole fro example, occurs suddenly as a result of Adolf Hitlers rise to power in 1933 and his
particular idiosyncratic conception of Gemran national interest
- This shift emphasis from variation in material capabilities to variation in state preferences os
the essence of Schwellers theoretical contribution
- Schweller reverses the causal arrow of realism. Rather than arguing, as have realists for
centuries, that the distribution of power influences

- Realists are suddenly embracing legalism treating international institutions as autonomous

forces and stronger in impact
- Joseph on European monetary integration > binding hypothesis, whereby weak states, rather
than forming a balancing coalition against or submitting to the will of a large state propose legal
commitments that allocate voting rights within international institutions so as to redistribute
power from the powerful to themselves (primarily, Germany appeasing France and Italy). How
could states primarily concerned with relative gains aver agree to surrender basic elements of
state soverereingty .

- No single theory can or should claim explain all of world politics or to be empirically preeminent
under all circumstances. Assertions of blanket pre-eminence undermine the credibility of modern
realism, whereas acceptance of assumptions that impose explicit constraints on empirical
domain would be a sign of theoretical maturity
- Eg: security disputes among advanced industrial democracies tend to be resolved non-militarily
a liberal prediction consistent with the near total suppression of realists politics among them
observed by Schweller, Snyder, Grieco, Van Evera, and others. In such cases, realists theory is
not disconformed - but is simply inappropriate, because it is assumptions are not met

- Replacement of noncasual mania with such multicasual, even multi paradigmatic syntheses,
is desirable, even imperative
- Liberal, epistemic, and institutionalists theories. These are potent competitors to realist claims
and should be recognized as such. Any categorization of international relations theories that fails
to accord those a central and distinct place is profoundly misleading.

--------------------------------------

21/04/2015
Economic interdependence and political divergence: the emerging pattern or
relations across the Taiwan strait by susheng Zhao
Taiwan: profile Accumulation comparative advantage
Economic interactions between Taiwan and China have grown when Taipei government
eliminated the restrictions on indirect trade with the mainland in the late 1980s. A growing flood
of cross-border investment and trade has created an economic interdependence. However,

intensified economic exchanges have not help for the political recognition of legitimacy to each
other or hostility across the Taiwan Strait. Growing economic interdependence has been a
function of political power and political choice. This paper examines the emerging pattern of the
relations across the Taiwan Strait and attributes the discrepancy between economic and political
relations to significant disparities across the Taiwan Strait, which has worked as both integrative
and disintegrative forces. A contradictory development of economic interdependence and
political divergence has characterized the emerging pattern of relations across the Taiwan Strait.
Taiwan is now the second largest investor of china and the china became the top overseas
investment destination and the second largest export market of Taiwan. However, the
improvement of political relations across the Strait has lagged much behind the economic
relations. The intensified economic interactions have not led the two governments toward an
agreement on reunification or recognition of legitimacy to each other. Military force can be used
in stopping the development of Taiwan's independence, evident in Beijing's military exercise,
including missile tests, aimed toward the shores of Taiwan prior to Taiwan's first direct
presidential election in early 1996.
Economic interdependence
Beijing and Taipei, the two regimes across the Taiwan Strait, have steadfastly refused to
recognize each other's legitimacy since 1949. The turned point arrived in the 1980s. The Taiwan
government began relaxing restrictions on trade, investment and travel to the mainland in 1987.
The government liberalized indirect imports of mainland goods into Taiwan in June 1989. In 1990,
Taipei permitted indirect investment on the mainland. In1995, in response to the eight-point
proposal about high-level negotiations to end hostility across-Strait made by Jiang Zemin, Taipei
officially announced that cross-strait relations would henceforth hinge on economy and trade (yi
jingmao wei zhuzhou). Economic interaction across the Taiwan Strait grew increase a lot despite
a political problem.
In contrast to some predictions at that time, the crackdown of the democracy movement did not
cut, but rather accelerated the development of the mainland's economic links with Taiwan.
Taiwan also used the sanctions of Western countries' economic sanctions against China, Mmany
taiwans business man take the place of the west => Cross-strait trade increased 28.02% in
1989, driven by a large scale relocation of Taiwan investment into China.
Total trade between the two sides exceeded $5 billion in 1990 and $11 billion in 1993. In 1995,
Taiwan ranked second (after Japan) as mainland China's major supplier and was its seventh
largest export market. Prior to 1987 there was virtually no Taiwanese investment on China. etc
etc.
The politics of economic interdependence
The governments on both sides of the Taiwan Strait have been deeply involved in promoting or
regulating economic exchanges. Beijing thought that with the interdependence that encouraged
the national unification and not the desire to independence. Economic interaction is prescribed
by Beijing's leaders as a way of developing political relations and promoting reunification. China
wanted the relation for the beginning. They believed that helped for the reunification.
The Taiwan government has been very cautious toward economic interaction. Its policy initially
sought to retard emerging economic exchanges with the mainland, while later only
accommodating gradual opening. He was not sure to start trade links. Maybe it was good to
improve relations for the 'independence or maybe not. These concerns were heightened when
Taiwan's trade dependence on the mainland increased steadily from 1.49% in 1986 to nearly
10% in 1995. They were concerned because it was important to keep the non-commercial
dependence
Perplexing disintegrative tendencies
It is evident that the growing economic interdependence across the Taiwan Strait has been a
function of political power and political choice. The heavy involvement of governments is a major
factor preventing the economic exchanges from bringing a political spill-over effect to alleviate
hostility and tension. Leaders in Beijing and Taipei have very different political agendas in the
economic exchange. While Beijing views economic interaction as a way of facilitating the
eventual political reunification of China, Taipei sees it as a lever for extracting political

concessions from Beijing with regard to recognizing Taiwan as a political entity, renouncing the
use of force against the island, and allowing Taiwan a large voice in the international affairs. As
the agendas of the two governments are too far apart to be reconciled, the economic exchange
has not brought any goal of reunification or recognition of Taiwan as a political entity.
In surveys conducted between 1989 and 1994, the percentage of respondents who 'strongly
agreed' or 'agreed' that Taiwan should be independent rose from 8.2% (December 1989), to 12%
(December 1990), 12.7% (June 1991), 15.1% (October 1992), 23.7% (May 1993), and 27% (April
1994).
In March 1996, before Taiwan's direct presidential election, Beijing conducted a new wave of
military exercises. On 8 March, the PLA launched three missiles on target areas just 20 nautical
miles from Keelung, Taiwan's second busiest seaport, and just offshore from the harbor of
Kaochung, the third largest container port in the world. From 18-25 March, joint ground, naval,
and air military exercises were conducted in the Taiwan Strait. Beijing's use of military threats,
however, did not halt the Taiwan independence movement.
One public opinion poll conducted while the missile tests were in progress indicated that the
percentage of people supporting Taiwan's independence exceeded, for the first time ever, the
percentage supporting reunification. The explanation for this change, according to a Taiwanese
analyst, is that 'the military exercises and the missile tests have forced people to think more
seriously about Taiwan's future. the use of force does not help to get a unification.
Conclusion
The above study of cross-Taiwan-Strait relations reveals two important phenomena.
The first is that the emergence of economic interdependence has, to a great extent, transcended
the scope of political differences. The second is that intensified economic ties have not resulted
in a spill-over effect to overcome political disintegrative tendencies.
How to construe the discrepancy between economic and political relations? One of the key
factors is economic and political disparities across the Taiwan Strait. Economic disparities have
created many opportunities for trade and capital flow, leading to economic interdependence. But
the same economic disparities, together with their differences in political systems and
ideologies, have made political spill-over very difficult, if not impossible.
They started to have an important benefit with the ivestement started in 1980s. They wanted to
find cheap labor and material resources. Taiwan, together with Hong Kong as the financier,
investor, supplier, and provider of technology for China, helped smooth the transition from
central planning to market system, in contrast to the difficulties faced in Eastern European
countries and the former Soviet Union.
The inflow of more than $70 billion in capital from Taiwan and Hong Kong stimulated the
economic take-off in mainland's coastal areas. The five rapid developing provinces and regions
of Guangdong, Jiangsu, Fujian, Shanghai, and Shandong are the areas that have received most of
the foreign capital. Many people believe that Taiwan has received disproportionate gains in the
economic exchange because of the disparities.
The critics also found that these businesses contribute little to China's social welfare system.
Generally speaking they do not chip in much for education or compensation for unemployment,
nor do they care much about environmental issues.
All these have added to Beijing's determination not to give up the use of force, which is its
comparative advantage, to bring Taiwan back. To conclude, economic disparities may work as
both integrative and disintegrative forces. Although disparities have promoted economic
interdependence across the Taiwan Strait, they have also obstructed the political spill-over
effect. The disparities of economic and political relations suggest that if political integration of
the mainland and Taiwan is to occur, it is likely to be as the result of the mainland's economic
development and political transformation as the economic intermingling.
When do conflicting political relations affect international trade? by Scott L. Kastern
Limited commercial integration between India and Pakistan or within much of the Middle East
suggests that conflicting political interests between countries can have a detrimental effect on
their economic relations. But rapidly growing economic ties between Mainland China and Taiwan

show that commerce can also flourish even in the presence of very hostile relations. I explore
this variation and hypothesize that the effects of international political conflict on trade are less
severe in cases where internationalist economic interests have relatively strong political clout
domestically. Simple quantitative tests on a sample of seventy-six countries over the years 1961
to 1992 are supportive; further evidence is provided via a brief case study of Mainland ChinaTaiwan relations.
Conflicting International Political Relations and Trade
Why Would Conflicting Political Interests Affect Commerce?
The existing literature suggests at least two broad mechanisms through which conflicting
political interests could undermine trade between countries.
- First, commerce sometimes generates security externalities (Gowa 1994); state leaders may
therefore wish to limit trade with an adversary or a potential adversary.
- Second, firms may view trade between countries with conflicting political objectives as more
risky than it otherwise would be (Morrow 1999). Consider first security externalities.
For example, trade can impact on the military balance of power: exports of strategic goods,
especially those with direct military applications, can improve an adversarys military
capabilities. State leaders thus sometimes block such exports to countries with which they are in
conflict.
To summarize, existing studies have shown empirically that conflicting political interests at the
international level, operationalized in a variety of ways, tend to be associated with reduced
levels of trade.
If Trade Follows the Flag, Why Does Commerce Flourish across the Taiwan Strait?
The international political objectives of leaders in Taipei and leaders in Beijing have been in
conflict since the Nationalist Party (the KMT) retreated to Taiwan at the end of the Chinese Civil
War in 1949. Since the mid1990s, Mainland Chinese officials have denounced the strategy for
the independence of Taiwan.
Despite persistent conflict in relations across the Taiwan Strait, economic ties between Taiwan
and Mainland China have burgeoned since the late 1980s. Trade, dominated by Taiwanese
exports to the Mainland, grew from under US$1 billion in 1986 to over US$76 billion in 2005.
Mainland China is now Taiwans largest trading partner. Investment flows have also grown
rapidly. As of mid-2006, Taiwan had approved over US$50 billion in Mainland investments, and
many estimate that the true value of accumulated Taiwan investment in China far exceeds
US$100 billion. The Taiwanese government, for example, continues to place restrictions on trade
with and investment in Mainland China that it does not impose on other countries. But the scope
of these restrictions has declined sharply since the 1980s, and cross-Strait economic flows have
grown extremely rapidly.
When Does International Political Conflict Affect Trade? Domestic Political Interests as
an Intervening Variable
My core hypothesis, therefore, is straightforward: the negative effects of conflict on commerce
should be less severe when internationalist economic interests have strong political clout
domestically.
there are two hypothesis
Hypothesis 1: All else equal, the negative effects of international political conflict (the extent to
which two states have dissimilar interests) on trade are less severe to the extent that leaders in
the countries involved in conflict depend on the support of internationalist economic interests,
with the corresponding null:
Hypothesis 0: The effect of international political conflict on trade is not contingent on the
domestic political strength of internationalist economic interests.
Political Rivalry, Internationalist Economic Interests, and Taiwans Changing CrossStrait Economic Policy

After giving some broader context, I focus on one particular episode: the decision by the Chen
Shuibian administration to relax Taiwans cross-Strait economic policy in 2001. Earlier, I noted
that Taiwanese officials have worried about negative security externalities associated with crossStrait economic integration. As such, they have tried to slow that integration by imposing
restrictions on cross-Strait economic flows. Nonetheless, though many restrictions remain in
place, the general trend since the late 1980s has been one of liberalizationdespite continued
tension in cross-Strait political relations.
It was only in the late 1980s that Taiwan authorized indirect trade and investment ties with
China; prior to that, all cross-Strait economic flows were banned. Early Taiwan investors in China
tended to be small, labor-intensive industries. By the mid-1990s, however, an increasing number
of Taiwans largest business groups were investing in China (Chu 1997, 242). That Taiwans larger
firms were entering the China market in greater numbers was a source of concern for Taiwanese
officials, since this phenomenon had the potential to increase substantially Taiwans economic
dependence on China.
In August 2001, President Chen Shui-bian (2000-present) replaced the Go Slow policy with a new
policy of aggressive opening and effective management.
Although increasing cross-Strait political tensions may have motivated, in part, Lees decision to
implement the Go Slow policy after 1996, no clear thaw in relations preceded Chens decision to
relax those restrictions in 2001. Changes in the cross-Strait political environment, in short, are
not sufficient to explain changes in Taiwanese economic policy toward China. If we also consider
the political strength of internationalist economic interests in Taiwan, however, a fuller
explanation becomes possible. there is good reason to think that the business community had
considerable political strength in the early part of Chens presidency
Conclusion
Most of the existing literature does not examine variation in the effect of international political
conflict on trade. I have hypothesized that the effects of conflicting interests on commerce
should be less severe when internationalist economic interests are strong in domestic political
systems, and I tested this hypothesis both quantitatively and qualitatively. The results were quite
promising, though not without qualifications. For example, key concepts such as conflicting
interests and the strength of internationalist economic interests are difficult to operationalize in
practice. Still, the results presented above provide an initial answer to the puzzle outlined in this
essay. To explain variation in conflicts effects on commerce, it is useful to open the black box
of domestic politics. The findings also represent an important bridge between the literature on
the domestic determinants of foreign economic policy and the literature on the effects of
international political conflict on trade. Neither a focus on states domestic political processes
nor an emphasis on the international political environment in which countries operate is
sufficient to understand states foreign commercial policies. Rather, the two arenas can interact
in complex ways in shaping the commercial relationships between countries.

Commerce between rivals: realism, liberalism, and credible communication across the
Taiwan Strait by Steve Chan
China has become Taiwans most important export and investment destination. This
phenomenon is puzzling to realism as concerns for security externalities should discourage
commerce between adversaries. Liberalism also has difficulty in accounting for this phenomenon
because an absence of facilitative institutions should discourage commerce across the Taiwan
Strait. This paper applies recent theoretical development on credible communication to this
seemingly baffling situation. Whereas it has been suggested that commercial ties enable states
to signal resolve short of military demonstration, I argue that these ties can also be used to
credibly communicate reassurance and commitment to peaceful cooperation.
Introduction
Despite continued political impasse and even occasional military tension, Taiwans exports to
and investment in China have thrived in recent years. China has overtaken the United States and
Japan as Taiwans most important trade partner, and it has received more capital from Taiwans
investment outflow than the rest of the world combined. Mounting cross-Strait commerce
predated the March 2008 election of a Kuomintang (KMT, or the Nationalist Party) government,

which replaced the Democratic Progressive Party (DPP) with its professed goal of fostering
Taiwans independence. The latter government under President Chen Shui-bian had sought to
limit the islands trade with and investment in China. In reaction, its business people tried to
escape official scrutiny, often by resorting to intermediaries located in Hong Kong and elsewhere.
Apparently relying on unofficial sources, the Nightly Business News reported (on July 28, 2006)
that China accounted for 40% of Taiwans exports and 70% of its foreign direct investment in
2005.
According to Chinese government sources (Taiwan Greater China Fund, 2006), Taiwans trade
with China reached US$108 billion in 2006, representing a gain of 18% over 2005. Taiwans
exports to China rose 16.6% to US$87.1 billion and its imports from China grew 25.3% to
US$20.7 billion. et etc
The figures show that Taiwans commercial ties with China are both highly salient and
asymmetrically important to its economy. Smaller economies tend to be open economies
because, unlike their larger counterparts, they have a greater need to trade in order to make up
for resources they lack domestically.
I address this puzzle from Taiwans rather than Chinas perspective. The thrust of my argument is
that civil society, especially the business community, can develop dense commercial ties abroad
such that it becomes more challenging for current and future politicians to reverse these ties or
roil political relations.
Realism
Commerce produces income and efficiency gains. These gains, however, have security
externalities such that a potential enemy can apply them to improve its military capabilities. To
the extent that the two sides stand to gain unevenly from their economic exchanges, realists
expect security-minded states to eschew commerce. As emphasized by writers such as Gowa
(1994) and Grieco (1988, 1990), concerns about security externalities and relative gains would
especially hamper trade between states that perceive each other as potential adversaries. Given
these realist expectations, one would not have expected Taiwan to enter into commercial
dealings with China that involve huge, asymmetric, and long-term financial commitments that
increase its economic vulnerability.
=> to have political concessions.
Someone underlined how the high economic salience tends to undermine a states credibility to
deter and resist aggression.
Less possibility that the other take an aggressive politics. In contrast to these subtle applications
of economic statecraft, Beijing has been transparent and consistent in advancing its sovereignty
claim over Taiwan.
Liberalism
This explanation can be more easily provided by liberalism, which does not share realisms
assumptions about the primacy of security concerns and the primacy of a unitary state in the
conduct of international relations (Moravcsik, 1997; Legro and Moravcsik, 1999). Liberalism can
argue that Taiwans commercial overtures to China were led by the private sector with the state
reacting to business initiatives. Given liberalisms attention to multiple, contesting social
interests that seek to influence a states policy, and its emphasis on the states response to
these interests, it seems only natural to surmise that Taiwans democratization process
empowered businesses at the expense of its formerly powerful developmental state (Gold,
1986). According to this reasoning, the end of martial law, increased electoral competition, and
intensified pressure brought on by accelerating economic globalization promoted opportunity as
well as willingness on the part of Taiwans enterprises to turn to China. This reasoning is not
wrong but overlooks one critical consideration emphasized in standard liberal accounts.
4 Synergism
Thriving commerce across the Taiwan Strait suggests that both realists and liberals are overly
pessimistic about the probability of economic exchanges occurring. Realists appear to have
assigned too much weight to security externalities, and despite their assertion that the pursuit of
military security will always trump the benefits of economic interdependence (e.g. Ross, 2006),

trade and investment can occur between political rivals and even military adversaries in the
midst of a war. Liberals also appear to be too gloomy about the prospects of commerce in the
absence of robust institutions and in the face of substantial information and transaction costs.
After all, commerce across the Taiwan Strait has taken off even in the face of considerable
uncertainties about banking agreements, dispute resolution mechanisms, and obstacles thrown
by the government ban on direct travel and restrictions on trade and investment. The enormous
amount of commerce occurring across the Taiwan Strait offers strong contrary evidence,
suggesting that the standard concerns of realists and liberals (such as those regarding security
externalities and institutional uncertainties) may be overstated. Rather than relying on any
monocausal explanation, deepening economic relations between Taiwan and China can be traced
to a confluence of factors. Political liberalization in Taiwan, Chinas turn to economic reform and
international openness, Taiwans shifting comparative advantage, the pressures of global
competition and, of course, the natural complementarities between the two sides due to history,
culture, physical proximity, and factor endowments are all indispensable parts of an overall
explanation.
A particularly salient aspect of this explanation is the role played by Taiwans societal and
economic interest groups that led the way to establishing and later expanding commercial ties
with China, often against the states injunctions and obstructions.
Facing the decline of labor-intensive manufacturing and waning shares in the US market,
Taiwans entrepreneurs turned increasingly to China. These push factors were complemented by
pull factors from China, including its incentive packages for attracting Taiwans investors.
Cultural and physical proximity and family ties offered facilitative conditions, whereas the
development of physical infrastructure, provision of low-cost and abundant labor, and expansion
of a consumer market in China added reinforcing conversion factors.

Taiwans is one of the worlds top electronic producers

- Taiwanese firms account for roughly 80-90% of the production of laptop/notebook computers
globally
- 65% of scanners
-60% of monitors
- 40& of network interface cards
- China is now the worlds largest exporter of ICT products after the USA-. But it is estimated than
40-80 % of chnas computer hardware is produced in Taiwanese owned factories.

Taiwan and global china-centered manufacturing supply chains

- China centred global production chains: East (procedding trade); china (processing trade); West
|
- Taiwan in ICT production chains: Japan;
US & EU

Taiwan;

=> Taiwan intermediate trade.

barby 30 dollars in china 30-40 cent

Chinas export performance

- In 2000 the value of Chinas final electronics goods (FEG) exports to the world: 50 billio

- By 2010 Chinas exports of final electronics.

Composition of Chinas exports to the world, 1993 / 2010 (100%= 97,182 mil usd):
- Textiles (38%)

electronic (32%)

- Wood paper (12%)

Textiles (16%)

- Food agriculture (10%)

Machinery (11, 3%)

- Electronic (9.5%)

Electrical (10, 3%)

- Chemical (8%)
..
Composition of Chinas imports from the world, 1993
machinery (22%)
electronic (13%)

22/04/2015
The value of chinas exports of labor intensive goods and final electronics good to the world.

Chinas export performance

- China imports large quantites of parts and componenets, add valu to these, and exports the
final goods. In 2010 almost 90 per cent of Chinas electronic imports came from east Asian
countries
- (Triangula trading patterns

- When are international political relation likely to affect trade?

=> international economic interest those actors that support and gain from integration into
global markets- are strong politically with states > that is when commerce can come to flourish I
the presence of international political conflict (interest dissimilarity rather than violent military
conflict; states with conflicting political objective can attain a high level of commercial
integration to begin with).

If trades follows the flog, why does commerce flourish across Taiwan strai?
- Core issues of sovereingnty; china threat
- the Taiwanese government continues to place restrictions on trade with and investement in
Mailand china that it does not impose on other countries
- Domestic political interests as an intervening variable:
=> core hypothesis> the negative affects of conflicts on commerce should be less severe when
internationalist economic interest have strong political clout domestically (internationalist
economic interest refers to actors who benefit from integration into world markets.)
- a versus B> bargaining power vis a vis B>..

-operationalizes the two key interest he sets out to incorporate: divergent interests (using a
proxy for interest similarity based on the extent to which two countries exhibit similar voting

patterns in the United Nations(UN) General Assembly), and internationalist interest (using trade
barriers as a proxy for the political clout of internationalist economic interest)
- Taiwans transformation from an authoritarian one- party state in the mid- 1980s to a
competitive multipolarity democracy by the mid 1990s certainly increased the political influence
of the islands business community to some extent
- Increased demand for campaign finance
- business and business organizations were by the 1990s given a great voice in the cross-strait
economic policy-making process
- IT Bubble burst in 2001: deteriorating economic outlook Taiwan by 2001 had entered severe
recession

- Conclusion:
Neither a focus on states domestic political process nor an emphasis on the international
political environment in which countries operate is sufficient to understand states foreign
commercial policies. Rather, the two arenas can interact in complex ways in shaping the
commercial relationships between countries

27/04/ 2015
EONOMIC INTERDEPENDENCE AND CONFLICT
- WWI is not