Bluff to peace: How economic dependence promotes peace despite increasing deception and uncertainty

Abstract

Trade–conflict studies have shown that economic dependence can promote peace by costly signaling resolve. However, with higher economic integration, targets also become more vulnerable to coercion and potential challengers are incentivized to bluff. In return, target states may resist more, raising the question of whether trade still promotes peace. I theorize that bluffing does not stoke conflict in this context because the bargaining environment allows states to inform and coerce simultaneously: the factor that renders a threat less credible also restrains states from further escalation. I test this theory’s implications with a structural estimation method and find supporting results.

Biding time versus timely retreat: Asymmetric dependence, issue salience, and conflict duration

“…Specifically, if under some conditions higher asymmetry incentivizes states to quit earlier, then as this incentive grows stronger it can also suppress conflict initiation in the first place. In contrast to the current understanding that asymmetry sabotages the pacifying impact of economic interdependence, the article indicates that specific conditions deserve further investigation (Crescenzi, 2003; Zeng, forthcoming). In this regard, the article also complements the existing research on commercial liberalism which has proffered two primary theories of trade’s pacifying effect: the opportunity costs theory emphasizes the restraining impact of prospective economic disruption, while the costly signaling theory highlights the signaling benefits of self-imposed costs.…”

“…I weigh the trade value of the above four types of commodity by their respective trade network closeness measures. Specifically, I follow Zeng (forthcoming) and take the product of trade value and the exponential of the negative value of closeness (trade*exp(-closeness)) . This way, I can capture the idea that states that are more integrated in global trade networks of a given commodity would value the respective commodity’s trade relatively less.…”

“…First, states that are more integrated into global trade networks can more easily find alternative markets and are therefore less vulnerable to economic coercion (Maoz, 2009; Dorussen & Ward, 2010; Peterson, 2011). In line with the recent development of network analysis, I use the closeness measurement to proxy how integrated a state is in the trade networks (Kinne, 2012, 2014; Zeng, forthcoming). Second, the restraining effect of trade varies across different commodities.…”

“…In particular, leadership turnover in South Korea and the potential thereof in the USA also played a key role. Zeng (forthcoming) also notes the signaling effect in the THAAD conflict. However, the mechanism depicted here is more nuanced: states consistently revise their beliefs over time and the signaling effects are conditional.…”

Religion and Political Economy

“…In terms of implementation, avoiding conflict and war between countries is one of the benchmarks for realizing world welfare and justice. 51 In the concept of Islamic economics, the emergence of social class differences in the economic sector in human life cannot be justified. These class differences are the result of an historical process that is existential, as Marx and his followers interpret the process of transforming the system of people's lives from the communal level to the top system, namely communism.…”