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• W2507609952 abstract "In the early 1970s, students of international relations began what would become a long and heated debate about the political correlates of open international markets. Recently, however, an important element of consensus has begun to emerge: most contributors to this debate now seem to agree that the prisoner's dilemma structure of state preferences with respect to trade explains the relative dearth of open international markets.! Here, we argue that what has become the standard prisoner's dilemma representation neglects the most critical aspect of free-trade agreements in the anarchic international system, namely, their security externalities. We consider these external effects explicitly. In order to do so, we construct and analyze a simple game-theoretic model. The results of this analysis demonstrate that tariff games between allies differ systematically from those played between actual or potential adversaries. These differences imply that free trade is more likely within, rather than across, political-military alliances. However, our analysis also suggests that the evolutionary prospects of alliances vary: those that are the products of bipolar systems are more likely to evolve into free-trade coalitions than are their multipolar counterparts. Less credible exit threats and clearer responsibilities for alliance stability explain the advantage of a bipolar system. We test this argument using data drawn from an 80-year period beginning in 1905. The empirical analysis supports our argument. It demonstrates that alliances have a direct, statistically significant, and large effect upon bilateral trade. Moreover, it shows that on average, alliances have a much stronger effect on trade in a bipolar than in a multipolar world.2" @default.
• W2507609952 created "2016-09-16" @default.
• W2507609952 creator A5037231066 @default.
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• W2507609952 date "1993-01-01" @default.
• W2507609952 modified "2023-09-27" @default.
• W2507609952 title "R recent literature attributes the relative scarcity of open international markets to the prisoner's dilemma structure of state preferences with respect to trade. We argue that the prisoner's" @default.
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• W2507609952 hasPublicationYear "1993" @default.
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