Fateful Transitions
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Daniel M. Kliman. Fateful Transitions
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Fateful Transitions
How Democracies Manage Rising Powers, from the Eve of World War I to China’s Ascendance
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This challenge to the commercial peace has not gone unanswered. In an early survey of the simultaneous interaction between trade and conflict, Soo Yeon Kim determines that the strongest line of cause and effect runs from commerce to peace.51 Oneal, Russett, and Berbaum likewise demonstrate that while a two-way relationship characterizes trade and conflict, a dispute between states will only depress bilateral commerce for a short period. Controlling for several factors that might influence trade flows, they also find that alliances have no impact on commerce between states.52 Last, Havard Hegre, Oneal, and Russett uncover methodological flaws in the two recent studies negating the commercial peace. They “show that the pacific benefit of interdependence is apparent when the influences of size and proximity on interstate conflict are explicitly considered.”53
A subset of the literature on trade and peace explores how economic interdependence interfaces with domestic politics to shape a state’s strategic choices. Paul Papayoanou maintains that extensive economic ties with a rival power will hinder a state’s capacity to hedge or contain. Groups that directly benefit from commerce with the rival power will be reluctant to view it as hostile and oppose the adoption of confrontational policies. In addition, political leaders will fear the consequences of a more assertive strategy—that the rival power will sever commercial relations, resulting in painful economic dislocation at home. Papayoanou argues that democracies are more vulnerable to both of these dynamics because they accord all interests a voice in the making of foreign policy.54 Kevin Narizny advances a related argument. Sectors dependent on an external power for their economic livelihood will champion a foreign policy of accommodation while sectors that compete with that power in third markets will prefer more hardline approaches. Sectors reliant on trade and investment with a multitude of foreign partners will advocate international law and institution building but stand ready to oppose aggressors that threaten regional or global stability. The balance of these sectors within a state’s ruling political coalition will dictate its strategic choices.55
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