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Sat. September 21, 2019
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Weakening Realism: Balancing Competition with Trade
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By Amien Kacou

Introduction

Realists hypothesize an international state of nature in which anarchy creates a tendency toward international competition—although different types of realists explain this initial or underlying dominance of competition over cooperation in different ways. Classical realists assume that states prioritize competition because human beings are, by nature, greedy predators who value power over others as an end in itself (Morgenthau, 1946, pp. 192-194). Neorealists argue that, though states might be solely or primarily motivated by security, they are still biased toward international competition—not simply because of a posteriori circumstances, such as states’ occasional need to monopolize scarce resources, but also because of the a priori (or “structural”) features of international anarchy, including states’ inevitable uncertainty about the intentions of their peers (Mearsheimer, 2001, p. 31; Waltz, 1979, pp. 88, 102, 118).

Security dilemmas—situations in which “one state’s gain in security […] inadvertently threatens others” (Jervis, 1978, p. 170)—are the general cause of competition between security seekers. Different types of neorealists disagree over whether, when and to what extent such dilemmas can be mitigated or eliminated, as they disagree over how far states would or should go in order to achieve security. For example, offensive neorealists insist that states must maximize their power over one another in order to maximize their security, so that only hegemons can be satisfied with the status quo (Mearsheimer, 2001, pp. xi, 2, 21). By contrast, defensive neorealists argue that states must strive mainly to maintain the status quo because they can rarely afford to maximize their power (Waltz, 1979, pp. 118-119, 126-127). Nonetheless, all neorealists agree that states interacting states with no prior information about one another will automatically, by default, find themselves in a security dilemma, and will, therefore, choose first to compete (not to cooperate) with one another

Charles Glaser disputes this neorealist assumption. He argues that international anarchy needs not lead rational security seekers to competition because, he assumes, rational states must balance their strategies in light of the variability of both material and information conditions (with associated costs and benefits) in their environment (Glaser, 2010, pp. ix, 5, 9). Glaser argues that, by balancing strategies to anticipate different material and information possibilities, rational states will often favor cooperation over competition.

I argue that, while Glaser’s account highlights that competitive strategies may not always be rational, it still fails to refute that international anarchy will always create an initial bias (or a rebuttable presumption) in favor of competition between security seekers. This fact is underscored by the results of applicable traditional formal models (Stag Hunt, in particular), in which competition emerges as the dominant strategy for rational actors when taking in terms of bothinto account not only “Nash Equilibriums” and expected payoffs but also risk dominance.

However, I point out that one key reason why competition so dominates cooperation is an oversimplified definition of the concept of cooperation in traditional models and theories—which fail to differentiate “live and let live” strategies, on the one hand, from potentially more beneficial “trade” strategies, on the other. I argue, further, that, contrary to the realist view, there is no clear reason to treat trade as a less fundamental or less likely motive of states than either greed or security.

Glaser’s rational theory of international politics

Glaser’s theory is based on the argument that variations in material conditions (states’ relative resources, coupled with offense-defense distinguishability and the offense-defense defensebalance—as described below) and as well as variations in information conditions (especially states’ knowledge about others’ motives between security and greed prior to any particular interaction or signaling) can either avoid, eliminate, or at least reduce the likelihood or severity of security dilemmas (Glaser, 2010, pp. 3, 8, 24, 34, 73).

First of all, regarding material variables in particular, Glaser agrees with defensive neorealists that rational states can sometimes not only distinguish offensive military capabilities from defensive ones (offense-defense distinguishability) but also accurately measure the opportunity costs between pursuing offensive strategies and pursuing defensive ones (the offense-defense balance) (Glaser, 2010, pp. 45, 72-73, 139). Accordingly, he logically infers, when circumstances make a defensive strategy more advantageous, then security seeking states will be more likely to reach their basic objective without having to threaten or otherwise compete against one another (Glaser, 2010, pp. 86, 119-120).

Second of all, regarding information about state motives, Glaser assumes that, when rational security seeking states are uncertain of their peers’ motives, then they will balance between competitive and non-competitive strategies—in some consistent proportion to their likelihood of encountering greedy states, on the one hand, or other security seeking states, on the other (Glaser, 2010, pp. 5). Furthermore, he suggests that all states necessarily share some basic inclination toward security, because, he reasons, some minimal baseline of security is required in the pursuit of other motives—in other words, “most greedy states would value what they possess and therefore be interested in security” (Glaser, 2010, pp. 90).

Glaser concludes that rational states will select cooperative strategies more often than realism allows. However, he fails to clarify the frequency with which offensive and defensive capabilities or opportunities could be distinguished. Moreover, he neither precisely explains nor demonstrates what a general presumptive balancing of offensive and defensive possibilities might look like, or how it might obviate any presumptive bias toward cooperationcompetition. Likewise, he neither precisely explains nor demonstrates how anticipating possible interactions with both security seekers and greedy states could, on balance, also obviate any presumptive bias toward cooperationcompetition. Meanwhile, traditional formal models of international relations seem to show that such bias would be strategically justified.

The realist bias of traditional strategic models

As Glaser accurately observes, traditional formal models of international relations often assume that states are greedy (Glaser, 2010, pp. 119). For example, in Prisoner’s Dilemma—a two-player game where each player must choose either to cooperate or to compete with the other—players are assumed to have the following order of basic preferences: competing when the other cooperates (with a putative payoff equal to 3, or payoff = 3) is preferred to cooperating when the other cooperates (payoff = 2); cooperating when the other cooperates (payoff = 2) is preferred to competing when the other competes (payoff = 1); and competing when the other competes (payoff = 2) is preferred to cooperating when the other competes (payoff = 0) (Dixit and Skeath, 1999, p. 256). In this game, competition emerges as the best strategy for each player—it is the only “Nash Equilibrium:” the only outcome in which neither player stands to gain by unilaterally switching his or her strategy, regardless of what the other does (Dixit and Skeath, 1999, p. 82). Indeed, in Prisoner’s Dilemma, a player who competes when the other competes would get a lower payoff by switching to a cooperative strategy, and, likewise, a player who cooperates when the other cooperates would get a higher payoff by switching to a competitive strategy.

This strategic dominance of cooperation in Prisoner’s Dilemma can be further established by computing and comparing the expected payoffs of competition and cooperation over the entire set of possible interactions—that is, a payoff of 3 when a player competes and the other cooperates, added to a payoff of 1 when both players compete, equals an expected payoff of 4 (for competitive strategies); and a payoff of 2 when both players cooperate, added to a payoff of 0 when a player cooperates and the other competes, equals an inferior expected payoff of 2 (for cooperative strategies).

In the alternative, we could represent international relations on the model of a Stag Hunt. This game simply reverses the dominant preferences of Prisoner’s Dilemma players: it assumes that players would prefer cooperating with one another to exploiting the other. This might better reflect the assumption that states are pure security seekers (Glaser, 2010, p. 83, 130).

More precisely, in Stag Hunt, players are assumed to have the following order of basic preferences: cooperating when the other cooperates (with a putative payoff equal to 3, or payoff = 3) is preferred to competing when the other cooperates (payoff = 2); competing when the other cooperates (payoff = 2) is preferred to competing when the other competes (payoff = 1); and competing when the other competes (payoff = 2) is preferred to cooperating when the other competes (payoff = 0).[1]

Unsurprisingly, competition is a less attractive strategy in Stag Hunt than in Prisoner’s Dilemma. Indeed, in Stag Hunt, both mutual competition and mutual cooperation figure as Nash equilibriums: a player who competes when the other competes would get a lower payoff by unilaterally switching to cooperation, and, at the same time, a player who cooperates when the other cooperates would get a lower payoff by unilaterally switching to competition.

Furthermore, a similar result appears when we compute and compare the expected payoffs for each available strategy. We find that a payoff of 2 when a player competes and the other cooperates, added to a payoff of 1 when both players compete, equals an expected payoff of 3 for competitive strategies; and a payoff of 3 when both players cooperate, added to a payoff of 0 when a player cooperates and the other competes, equals an identical expected payoff of 3 for cooperative strategies.

However, though Stag Hunt allows for two Nash Equilibriums, it remains that one of them (the competitive equilibrium) “dominates” the other (the cooperative equilibrium). This is because competition still remains the least risky (or most robust) option for each player: a player who competes would be guaranteed a minimum payoff of 1 regardless of what the other player does, but the player who cooperates would risk a payoff of 0 if the other player alone switches to competition (Skyrms, 2004, p. 3-4).

Such “risk dominance” seems to confirm that rational security seekers must still have a competition bias—and that, by extension, the realist account of international relations might be justified. Cooperation equilibriums might well emerge over time, in repeated rounds of Stag Hunt, either through adjustments of information variables (as Glaser might expect) or through the evolution of social structures capable of constraining types of states—including the emergence of collective identities capable of introducing trust or even changing preferences within groups of states (as social constructivists would expect) (see Wendt, 1999). In fact, subjects in experimental Stag Hunt simulations have been found to cooperate on the very first round of play (Skyrms, 2004, p. 12). But, prior to such social developments, we must conclude that competition equilibriums should rationally dominate cooperative ones.

Nevertheless, it appears that the relevance of the Stag Hunt model depends on the assumption that strategic actors have a choice between only two basic types of move (and, by extension, that they may be animated by only two basic types of motives): competitive ones and cooperative ones. I argue, below, that this assumption oversimplifies the nature of cooperation, and that we should differentiate between not two but rather three types of strategies or motives: competition, “live and let live,” and trade.

Redefining “cooperation:” Distinguishing “live and let live” from trade

I argue that it is possible to further weaken (if not eliminate) the competition bias inherent in traditional strategic models by slightly refining the definition of player motives and strategies. To do so, it suffices to add to such models one additional more strategic option, which allows for the possibility that some states might derive a higher payoff from cooperation than is possible in Stag Hunts.

More specifically, whereas Stag Hunt reduces the concept of cooperation to a coarse concept of noncompetition, international actors might both conceivably and justifiably value not so much their mere security from peers (an interest whose ideal or extreme could be described as isolationism, mutual avoidance, “live and let live”…), or their own greed to dominate their peers (an interest whose ideal or extreme could be defined as expansionism, exploitation, unilateral aggression…), as they value trade with their peers.

The value of trade can be understood through the principle of comparative advantage—which describes situations where individuals or organizations are better off working with one another (coordinating and exchanging economic production in accordance with a division of labor) than working by themselves (Mankiw, 2008, pp. 55-56). This interest is clearly distinct from (and irreducible to) any interest in greed (which would could be a preference in exploiting others instead of exchanging with others) or any interest in security from others (which would could be a preference in avoiding others instead of exchanging with others).

Thus, the terms for player preferences in our model of pure security seeker interactions (Stag Hunt) could be redefined as follows, by substituting “being avoidant” for “cooperating:” being avoidant when the other is avoidant (payoff = 3) is preferred to competing when the other is avoidant (payoff = 2); competing when the other is avoidant (payoff = 2) is preferred to competing when the other competes (payoff = 1); and competing when the other competes is preferred to being avoidant when the other competes (payoff = 0).

Building on this, the model for states with a possible interest in trade (the “trade seeker” model) could be defined with the following player preferences: trading when the other trades (payoff = 4) is preferred to being avoidant when the other is avoidant or is trading (payoff = 3); being avoidant when the other is avoidant or is trading (payoff = 3) is preferred to either trading or competing when the other is avoidant (payoff = 2);[2] trading or competing when the other is avoidant (payoff = 2) is preferred to competing when the other competes (payoff = 1);[3] competing when the other competes (payoff = 1) is preferred to being avoidant when the other competes (payoff = 0); and being avoidant when the other competes (payoff = 0) is preferred to trading when the other competes (payoff = -1).

This trade seeker model seems to include three pure Nash equilibriums, instead of two: trade, mutual avoidance, and mutual competition (in order of payoff magnitude). A player who trades when the other trades would get a lower payoff by unilaterally switching to either an avoidant ( “live and let live”) strategy or a competitive strategy; a player who adopts a “live and let live” strategy when the other does the same would get a lower payoff by unilaterally switching to either a trade strategy or a competitive strategy; and a player who adopts a competitive strategy when the other also competes would get a lower payoff by unilaterally switching to either a trade strategy or a “live and let live” strategy. As in Stag Hunt, mutual competition might still remain the risk-dominant pure Nash equilibrium; however, in the trade seeker model, the expected payoff of competitive strategies over the entire set of possible interactions, or (2+2+1) = 5, though equal to that of trade strategies, or (4+2–1) = 5, becomes, crucially, inferior to the expected payoff of “live and let live” strategies, or (3+3+0) = 6.

In other words, the trade seeker model suggests, as we might intuitively expect, that states stand to lose more from the presumptive selection of competitive strategies than traditional international relations models and theories take into account. The strategic nature or structure of international relations might well automatically introduce a certain amount of international risk, but the potential benefit of cooperation could well suffice to outweigh such risk.

The main question remaining, then, would be whether the trade seeker model is equal to or better than its traditional alternatives, as a representation of actual international relations. And, here, I argue that, contrary to the explicit or implicit realist view, the assumption that states are “more dangerous than useful to one another” (Waltz, 1979, p. 144) is unjustified.

To see this point, it is important to distinguish two concepts of (international) security. On one hand, security can be defined most broadly as an interest in the protection of what an actor already possesses (see, e.g., Wolfers, 1952, p. 494). In this sense, security is understood “as a derivative objective that is valued only because it is necessary to ensure consumption” (Glaser, 2010, p. 40). On the other hand, international security can be defined more narrowly as protection against threats emanating specifically from other states.

It bears noting that security threats sometimes emanate from sources other than peers. For example, health crises and natural disasters can arise from internal or other environmental factors. Moreover, there is little reason to assume that addressing possible threats emanating from other states should take priority (either initially or generally) over addressing possible threats coming from such other factors. For example, by some estimates, “the total number of deaths in wars and conflicts for the entire 20th century […] comes to a total of between 136.5 and 148.5 million,” (Leitenberg, 2006, p. 9), whereas smallpox alone was responsible for 500 million deaths during the same period (Koplow, 2004, p. 1). To the extent that these estimates are correct, perhaps rational security seeking states should would “generally” worry more about the next epidemic than about the next war—assuming, at least, that their interest in security comes down ultimately to an interest in the material safety of their populations.[4]

Therefore, even assuming that, as a matter of rationality, security in the broad sense should take precedence over other goals (that is, because the preservation of what is already possessed is necessary to the pursuit of other goals) (see Glaser, 2010, p. 90; Mearsheimer, 2001, pp. xi, 2, 21), this priority does not necessarily apply to international security in the narrow sense. Instead, international insecurity could be understood as just one type of contingent threat among other threats that are equally- contingent others.

At bottom, states might not always be interested in one another’s resources—they might not always find anything worth trading with or exploiting in one another. In such cases, they should presumably favor a “live and let live” strategy. But no “structural” principle dictates when this scenario or its alternatives should occur. Accordingly, perhaps theorists should presume that the existence of international threats, on one hand, and the existence of opportunities for international cooperation, on the other, are equally probable features of the international environment.

Conclusion

Although traditional strategic models of international relations do suggest that competitive strategies are likely to dominate (by being less risky while at least matching the expected payoff of) cooperative strategies, those models fail to incorporate the possibility that states might benefit more from trade than from isolationism, and more from isolationism than from exploitation. Using strategic models in accordance with this possibility would reduce the often assumed attractiveness of international competition and, arguably, provide a more accurate representation of actual international systems.

References

Dixit, A., & Skeath, S. (1999). Games of Strategy. New York: W.W. Norton & Company.

Glaser, C.L. (2010). Rational theory of international politics: The logic of competition and cooperation. Princeton: Princeton University Press.

Jervis, R. (1978). Cooperation under the security dilemma. World Politics, 30(2): 167-214.

Koplow, D.A. (2004). Smallpox: The fight to eradicate a global scourge. Berkeley: University of California Press.

Leitenberg, M. (2006). Deaths in wars and conflicts in the 20th Century (3rd ed.). New York: Cornell University Peace Studies Program Occasional Paper #29.

Mankiw, N.G. (2008). Principles of economics (6th ed). Mason: South-Western Cengage Learning.

Mearsheimer, J.J. (2001). The tragedy of great power politics. New York: Norton & Company.

Morgenthau, M. (1946). Scientific man vs. power politics. Chicago: University of Chicago Press.

Skyrms, B. (2004). The stag hunt and the evolution of social structure. Cambridge: Cambridge University Press.

Waltz, K.N. (1979). Theory of international politics. New York: McGraw Hill.

Wendt, A. (1999). Social theory and international politics. Cambridge: Cambridge University Press.

Wolfers, A (1952) ‘National security’ as an ambiguous symbol. Political Science Quarterly, 67(4): 451-502.

 


[1] Another version of Stag Hunt assumes that both players are indifferent between competing when the other competes and competing when the other cooperates. However, such version would seem an inadequate representation of international relations, since, in the context of the latter, the cost incurred from another state’s competition must add to the cost incurred from unilateral military investments.

[2] Logically, a player that who favors trade but is not greedy, when faced with an avoidant counterpart, should prefer avoidance to any other interaction. In addition, we can assume for the sake of simplicity that such a player would be indifferent between the payoffs of all alternative types of such interactions—meaning that the cost of converting or using resources for trade (investing in a certain type of expertise or infrastructure, for example) would, on average, be equal to the cost of converting or using resources for military capabilities.

[3] A state competing when another competes will incur not only the loss of resources from the cost of using military capabilities but also the loss of resources from the damage due to the other’s attack.

[4] The alternative would be to assume that the security that states care about comes down to the preservation of other state features—for example, the preservation of territory—even in the rare but not impossible inconceivable case when threats to such features might actually improve the material welfare of state populations. However, such an assumption would make our concept of security much less distinguishable from what we would traditionally describe as an “ideological” interest.

 

Amien Kacou is an attorney in Miami, FL. His research has been published in Aggression and Violent Behavior, the Harvard National Security Journal (Features), the Peace Studies Journal and Perspectives on Terrorism. He holds a JD from the Florida Coastal School of Law, a MA in Global Security Studies from Johns Hopkins University, and a BA in Government and Politics from the University of Maryland. 

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