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Atoms for Peace, Redux: Energy Codependency for Sustained Cooperation on the Korean Peninsula

Author

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  • Beardsley Kyle

    (Emory University)

  • Lim Jamus J

    (The World Bank and Santa Cruz Center for International Economics)

Abstract

North Korea's nuclear program is a threat to sustained stability on the Korean peninsula. Unfortunately, the traditional notion of “Atoms for Peace" has been a failure in the engagement of the North. In this paper we propose a novel approach to mutual cooperation in energy provision on the Korean peninsula, premised on having North Korea host reactors that deliver energy to South Korea. We establish conditions where there exists a stable, time-consistent equilibrium where the North never finds it in its interest to disrupt energy supplies to the South, and where the South is willing to pay the fixed costs of nuclear plant construction in exchange for a discounted stream of energy supply from the North. We also show that third-party income streams can augment the cooperative relationship.

Suggested Citation

  • Beardsley Kyle & Lim Jamus J, 2009. "Atoms for Peace, Redux: Energy Codependency for Sustained Cooperation on the Korean Peninsula," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 15(1), pages 1-31, August.
    • Handle: RePEc:bpj:pepspp:v:15:y:2009:i:1:n:4
    DOI: 10.2202/1554-8597.1129
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    References listed on IDEAS

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