IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2111.15598.html
   My bibliography  Save this paper

Inefficient Peace or Preventive War?

Author

Listed:
  • Liqun Liu

    (\"Undes)

  • Tusi

    (\"Undes)

  • Wen

Abstract

We study a model of two-player bargaining game in the shadow of a preventive trade war that examines why states deliberately maintain trade barriers in the age of globalization. Globalization can induce substantial power shifts between states, which makes the threat of a preventive trade war salient. In this situation, there may exist "healthy" levels of trade barriers that dampen the war incentives by reducing states' expected payoffs from such a war. Thus, we demonstrate that trade barriers can sometimes serve as breaks and cushions necessary to sustain inefficient yet peaceful economic cooperation between states. We assess the theoretical implications by examining the US-China trade relations since 1972.

Suggested Citation

  • Liqun Liu & Tusi & Wen, 2021. "Inefficient Peace or Preventive War?," Papers 2111.15598, arXiv.org, revised Apr 2023.
    • Handle: RePEc:arx:papers:2111.15598
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2111.15598
    File Function: Latest version
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:2111.15598. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.