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1994 Assessing the Dispute in the South China Sea a Model of China's Security Decision Making

1994 Assessing the Dispute in the South China Sea a Model of China's Security Decision Making

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1994 Assessing the Dispute in the South China Sea a Model of China's Security Decision Making1994 Assessing the Dispute in the South China Sea a Model of China's Security Decision Making
1994 Assessing the Dispute in the South China Sea a Model of China's Security Decision Making1994 Assessing the Dispute in the South China Sea a Model of China's Security Decision Making

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Assessing the Dispute in the South China Sea: A Model of China's Security Decision Making Author(s): Samuel S. G.

Wu and Bruce Bueno de Mesquita Source: International Studies Quarterly, Vol. 38, No. 3 (Sep., 1994), pp. 379-403 Published by: Blackwell Publishing on behalf of The International Studies Association Stable URL: http://www.jstor.org/stable/2600738 . Accessed: 10/08/2011 18:05
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(1994) 38, 379-403 StudiesQuarterly International

Assessing the Dispute in the South China Sea: A Model of China's Security Decision Making

S. G. Wu

TexasA&M University

HooverInstitution, University Stanford and ofRochester University
domestic of internal, Chinese foreignpolicyis representedas a function political considerations.Through the analysis of Chinese policy, we a method for predictingthe outcome of policydecision makillustrate ing inside China. The substantiveissue is China's expected approach towardterritorial disputes in the South China Sea, especiallysurrounding the SpratlyIslands. We address the extentto which China can be to foreign policy expected to reallocateresourcesfromeconomicreform undertakingsin that area and how likelyChina is to utilize force to impose its will on weaker neighbors. The approach represents a markeddeparturefromthe predominant politics.We assume that decision neorealistparadigm in international makers seek an optimal compromisebetween enhancing theirsecurity and pursuing theirspecificpolicy or ideological goals. Using this perexspective,we conclude that,despite a dramaticincrease in military of China's naval forcein the strengthening pendituresand a significant uses of South China Sea, China is unlikelyto engage in any significant forceto pursue its agenda in the South China Sea.

Two objectives motivate the analysis here. We suggest a model for examining Chinese foreign policy decision making and we apply that model to the Spratly Islands dispute. The model is intended to provide tools for predicting reliably the outcome of decision making in China or in any other political setting. The substantive issue provides a laboratory in which to test the model. We provide detailed predictions about strategies and a policy resolution that will shape
Authors' note:We are gratefulto the Chiang Ching-Kuo Foundation for InternationalScholarlyExchange for the support they have provided to this project. We also wish to thank Dr. Cheng-chi Chang, Alexander Tan, Yu-guo Chen, and Guoqing Zhang fortheirassistancein developing the data forthisresearch.We have benefited as well fromthe insightsof the anonymous refereesand so take thisopportunity to thankthem. StudiesAssociation. C 1994 International Cambridge, MA 02142, USA, and 108 CowleyRoad, OxfordOX4 238 Main Street, Publishedby BlackwellPublishers, 1JF, UK.

the Chinese leadership seems to be facinga growingdilemma.Qian Qichen.The disintegrationof the Soviet Union and the success of China's economic reformshave contributedto China's power. This suggestsa pacificforeignpolicyin thateconomic reforms in the region.Rather we assume that nations consist of competing internal (and external) interestsvying to shape policy outcomes and making implicitcompromises between policy goals and security enhancementthroughmultiplestages of gamelikecoalitionformation. Chinese leaders have repeatedly announced thatthe continuationof the PRC's economic reform programis their and top priority. indeed. SubstantiveBackground China's (PRC) influencein Asia and.territorial we address the extentto which China can be claims and ambitions.These predictionsare expected to remain viable so long as no major exogenous shock of the data we use to analyze the altersthe structure occurs that fundamentally problem.we specifythe relevantdata and apply the model discussed here to China's policybehavior. the model suggested here views foreignpolicy as the foundationof internationalpolitics and not as a separate area of inquiry. We want to know how likely China is to utilize force to impose its will on its weaker Asian neighbors.they Indeed. our decision may seek to maximizeon a dimensionother than security. makers seek an optimal compromise between enhancing their securityand pursuing their specific policy or ideological goals. During this period of economic expansion. With the wealth generated by economic liberaliThe PRC zation. therebyenhancing its own military Journal.Followingthat discussion. On the one hand. China's foreignminister. 1992).Specifically expected to transferresources away from economic reformand toward the pursuit of foreignpolicy objectivesin the South China Sea.8/18/92:8). The approach we take representsa markeddeparturefromthe predominant neorealistparadigm in internationalpolitics (Waltz.1/19/92:4). China has embarked on a program to modernize its military.but unlike neorealiststates. Journal.is growing. In that sense.380 the Dispute in the South ChinaSea Assessing interChina's struggleto resolve the tensionsbetween securingtheirterritorial ests in the SpratlyIslands and the desire to promote economic growth. Like neorealiststates. Then we explain the model we use to predictand explain Chinese policymaking. We begin by summarizingthe substantivecircumstancesthat motivateour interestin evaluating Chinese policy in the South China Sea. The dispute over the SpratlyIslands in the South China Sea is particularly interesting because it captures the possible tensionbetween the domestic.our actors are rational. forbenefits unwillingto trade any amount of security such as might be represented by policypreferences. capabilities (World June 12.economic objectivesof the People's Republic of China and theirexternal. We do not assume that the nation is a holistic unitaryactor seeking to maximize securityand on some otherdimension.1 In this instability growthare not well-servedby politico-military 1Li Peng was quoted as sayingthatChina needs a peaceful international environment to embarkon itsvigorous economic reformprogram and that it is not the intentionof China to be a hegemonic power in Southeast Asia stated that all territorial disputes with neigh(World Journal. 1979). is generatingsignificant revenue from arms sales to the Third World and is using some of thisrevenue to acquire advanced weapons and technologiesfrom other countries. globally. boringcountriesshould be settledin an amicable and peaceful manner (World .most notably from the independent republics of the former Soviet Union.

expulsion of South Vietnamfromthe islands. For example. The first.After occupyingsix islandsbetween over all announced that it claims sovereignty 1988 and 1992. six are occupied by China. or so smallislandswere historically Located in the South China Sea.June 18. The Philippines. Yet at the same time China has expanded itsclaimsto the islands. This announcement. There have been two conferencesin Indonesia withinthe past few years to to resolvethe competingclaimsto the SpratlyIslands. 1993). threefactors behavior of countriesborderingthe South China Sea.three by Malaysia. China recentlypledged to use its naval forcesto back up an oil exploration project contracted to an American company. WU AND BRUCE BUENO DE MESQUITA 381 in avoidinginstability caused by territorial sense. Disputes over the islands also contributed to China's war againstVietnam in 1979 (Chen.They are just specks of atolls which were relativelyinsignificant changed the countriesin the area untilabout the 1950s. the SpratlyIslands have become one of the more dangerous for Southeast Asian security. theseforty but were not inhabited until quite claimed by China as part of its territory. nine by the up the group. June 18. 1989).China. to recently. resulted in the these islands over the past twentyyears. in Taiwan as well as by the PRC (Lo. WorldJournal. the claimantwill redefineits maritimeand propertyrightsto resourcesin surroundingwaters. Taiflashpoints dispute.Among the forty by Vietnam. the is claimed by exploration is situated in the Spratly Islands where sovereignty and the Republic of China (ROC) Vietnam. and Malaysia have all become involved in this territorial have been numerous small clashes and at least two recorded major clashes on in 1974. World Journal. and (3) considerationof the Convention on the Law of the Sea (Lo. G. and one by Taiwan (Central 1993). China formally the SpratlyIslands. On both occasions attempt China reiteratedits desire to see a peaceful resolution of the problem and welcomed peaceful. twenty-one DailyNews.2 Since the 1960s. China currently has an interest disputes in East Asia. which was demonstrated These factorsinclude: (1) the islands' strategic by theJapanese duringWorld War II.April 7.April 7.Vietnam. 1992. . 1992). However.Malaysia. It has been reportedthata Chinese high official if necessaryChina will use its "whole naval force"to protectthe company's oil June 17. some in East Asia are concerned that China's improved power may encourage its leaders to seek the resolution of several territorial disputes withitsneighborsthroughmore aggressivebehavior.By claimingtitleto the islands.China has sold oil exploration rightsin the South China Sea to an American companythatChina has property CrestoneEnergyCorporation-thereby implying rights mentionedthat over the area. (2) the vastwealthof oil in the surrounding territorial waters. On the other hand. unitsmaking 1987). withthe observed buildup of Chinese consistent Such a perspectiveis certainly military capabilities and with recent statementsby the PRC's leaders. has been followed by a somewhat proactive Chinese policy in the area.The second conflict This saw a small naval battle between Chinese forces and Vietnamese forces that leftseventy-four dead and three Vietnamese naval vessels sunk. exploration activitiesin the South China Sea (New YorkTimes. came in 1988.Indonesia. 1989. There wan. the Philippines. In this instance.made in March 1992. 1992). Philippines.SAMUEL S. For instance. Today the islands remain hotlycontested. China's declared willingnessto use force in the South China Sea contradicts as a environment the PRC's policyaimed at promotinga peaceful international 2This conventionhas defined the maritimerightsof coastal and island states. previouslydisinterested value. cooperative developmentof the area. More recentlythere have been unconfirmed reports that China dispatched three submarines to the area to back up its interests (Central Daily News.

.382 theDispute in theSouth China Sea Assessing prerequisite to accomplish its economic goals. 1967. And the instability thatwould be createdbysuch a conflict-regardless of who mightinitiateit-would certainly jeopardize China's economic modernization efforts. Chen. 1985. and otherswould interpret the PRC's willingness to cede territory it had previouslyclaimed as its own. which holds that Chinese traditionmakes itselffeltthroughthe personalitiesof individualChinese. Previous Assessments of China's Prospects of Using Force Over the past severalyearstherehave been a numberof significant investigations of issues germane to our focus (George. scholars have achieved only limited success in 3The fiveapproaches used in the fieldare (1) the teleologicalapproach. Afterall. and Kringen (1979) regardingstudiesof Chinese security policy making is still valid today.historicalcase studies. Stolper. (4) environmentaldeterminism. 1980.3 Up to this point. the PRC does not have an obvious advantage in a war foughtfar fromits border and especiallya war foughtfar out to sea.China must also worryabout how the Taiwanese.its theoreticalpower is greatlyenhanced. Gurtovand Hwang. the Tibetans. Bobrow. (3) juxtapositional linkages. identify behavior patterns. which relies heavilyon the expertiseof the individualanalystand the intensivescrutiny of particulardocumentsto figureout the scrambleforpower among the "interest groups. While China can probably overwhelmits neighbors in a land war. whichpositsChinese decision making as a process of careful calculation of alternativesto achieve clear and immutable goals.theyhave made considerable progress in understandingthe Chinese decision-making process. and Kringen propose a "systematic" approach to the studyof China's security policymaking. 1979:27). This concern lends credence to China's declaration that it will defend its claim to the SpratlyIslands withforceif necessary. assuming thatChina's claim to property rightsin China's abilityto carryout a successfulnaval war against several prospective opponents in the South China Sea is far fromclear. and quasi-experimentalexercises. there is good reason to believe that China's declarationin favorof an amicable resolution of the Spratly Islands dispute is sincere.Because this approach points out the logic that a rational decision maker should follow.Does China's declarationmean thatthe PRC is willing to use forceto discourage would-be challengersto its alleged propertyrightsin the South China Sea? Is China willingto shiftsome domestic resources away fromits economic reformprogramto support military engagements?These are questions we hope to answer. the area is sincere. Through qualitative contentanalysis. . Chan. the assessmentby Bobrow. 1989). Unfortunately. China's true intentionsseem difficult to discern." Alternatively.which rely on the post hoc reconstruction of particularepisodes in Chinese foreignrelations historyby juxtaposing currentevents. 1987. Segal. Lo. because surrenderingits claims mightbe taken as a sign of weakness. Chan. Because a war has great potentialcosts associated withit. which uses biographical information to identify possible conflicts among the Chinese leadership and explains policymakingsas resultsof these conflicts. The contradiction betweenChina's apparent economic interest in stability and China's declared intentto use naval forceif necessaryto secure its claims over in China's foreignpolicywhich the SpratlyIslands createsa troubling ambiguity calls out foran evaluation. but so must the prospectof a diminution in China's territorial integrity. the prospect of warfareover the SpratlyIslands mustbe daunting to China's leaders.theyconcluded in 1979. "The studyof Chinese foreignrelationslargely lacks systematic analyses that map policy situations. or estimate the parameters of international interaction" (Bobrow et al.but also the logic that determinesthe calculation of probabilitiesand utilities. 1985. But. After a careful discussion of the difficulties and limitationsof the five main approaches used to investigateChinese foreign policy. They call it systematic because it considersnot only particularcases and generalized patterns. and (5) kremlinology. (2) reductive analysis.

China waited for more than fortyyears to retake Hong Kong through peaceful negotiations. 1993). focuses on a combinationof external and internal considerationsto evaluate China's policy.4 Robinson (1970) echoes a related theme of its policyis mostlythe externalization by claimingthat China's international domesticpoliticalvalues. territorialintegrity vol.Huang.China has overlooked the occupation of several islands of the Spratlygroup despite thatcountry's relativeweakness compared to China (Lo. 1985:152). and cooperation. Indeed.formally and utilities lationsof probabilities and demonstratedto be useful. and Wu (1992) derived theoreticalpropositionsconcerning China's and Taiwan's conflict and cooperationdecision makingbyusing Bueno de Mesquita'sexpected theory(Bueno de Mesquita. Yet.Taking into account just such dyadic relations. no. 1985. (2) Chinese leaders environment is the optimumconditionforradical-socialist international believe that a quiescent (nonthreatening) development.SAMUEL S. to eitherthe domesticpopulation or the rest of the international Gurtovand Hwang (1980) and Stolper (1985) emphasize the importanceof domestic considerationsin China's securitydecision making. Newman.and in the case of Hong Kong. and (6) China's domesticstability initiatives (Gurtovand Hwang. 329. 1980:249). in some cases. to choices between conflict A related view. the factis violence. 1994).They argue that (1) the chief purpose of 4Gurtov and Hwang (1980) provided six interesting foreignpolicy in China is to protectand promote the radical socialistrevolutionat home. Kim. the dispute over the future of Hong Kong with the United Kingdom. They claim that upon its territorial China is adamant in its opposition to any attemptto infringe maintainingthat China is especially likelyto resortto arms to solve integrity. because of China's experiintegrity. . An analysis of China's decision process alone is only part of the story. (4) Chinese sensitivity international (5) foreignpolicybecomes a domesticpoliticalissue in China byaddressingeconomicor politicalchoices or conflict. Instead. population and to the leadership (Stolper. suggested by Chen (1987). 1989). Bueno de utility Mesquita and Stokman. disputes that threatenterritorial twentieth ences withEuropean imperial expansion in the late nineteenth/early centuryand more recent experiences with separatistmovementsin Tibet and is a very sensitive issue to the Chinese general Taiwan. point out that domesticconsiderations.extended Huang et al. The theoryapproximatesdecision maker calcuderived argument. The propositionsare then tested systematically alliance politics.and disputes withthe Philippinesover the SpratlyIslands. 1985. in disputes with the Philippines in particular. promotesconditionsthat are favorableto foreignpolicy that are under debate. withan explicit. Chen bases his of China's war withVietnam in 1979. The Economist. and of being 7836. He indiassessmenton his investigation cates that it is the combinationof such external factorsas the involvementof the two superpowers and the psychologyand personalityof Deng Xiaoping propositions. G. What is more. he maintainsthat "any serious attemptsat any bilateralrelationsmustdeal withthe analyticapparatuses reconceptualizing and behaviorof both governments" the motivations thatare used to investigate (Hsiung. Afraid of sending out wrong signals to secessionists China's leaders may be prepared to sacrificeecoaccused of being unpatriotic. including the Tiao-yu T'ai dispute (Senkaku Islands) against Japan. factorsthatcontribute and interactions between sides are important deterrence.The Senkaku Islands disputedid not prompt thatChina did not initiate a conflictual Chinese response. integrity so thattheywillnot be challenged to promoteterritorial nomicinterests by theirdomesticpoliticalopponents. WU AND BRUCE BUENO DE MESQUITA 383 policymakingas itrelates China's security explainingand especiallyin predicting community. (3) economic performanceis considered by Chinese leaders to be the key to national securityand to externalthreatis highestat timesof domesticpoliticalweakness legitimacy. Steven Chan contends in Hsiung (1985) that China's foreignpolicy cannot be understood in isolation. and Rabushka.

However. 1992).the most ubiquitous defense of his theoryis thatdespite itsconceptual problems. .forthcoming).1994.1993. 1991.serves as an additional testof the usefulnessof the theoreticalmodel. that focuseson the applicationof Black's (1958) median votertheoremand a theorem about the monotonicity between certainexpectationsand the escalation of po5For example. 1992. 1987:87-88). each with differentpositions. 1990:449). and Rabushka. Bueno de Mesquita and Stokman.000 forecastpolitical decisions and political interactions politicalissues.6 By using this model. 1985. Bueno de Mesquita's model is chosen because it has proven to be useful in analyzingand anticipating the resultsof policydebates among competinginterests in other settings(Bueno de Mesquita.theyfail to make explicitthe bargainingprocess in domesticpoliticsand the logic behind in conflict interactions decisionmakingamong relevantparties. 1990. and Rabushka. and war fighting shaped China's policy in the 1979 war with Vietnam. 1992. 1984. the decision by the advocates in Tiananmen Square in China. Wu. According to the United States government the model has made accurate and detailed policy predictionsin 90 percent of the situationsin which it has been utilized(Feder. Although we believe Chen and Huang et al.Deng calculated the possible Soviet response to the Vietnam war and was prepared for it. Bueno de Mesquita and Lalman. Majeski and Sylvan. we hope to address the two factorsthat possiblyaccount for the limitationof previous studies of Chinese and the paucityof securitypolicy: the lack of a general theoreticalframework systematic investigations. 1985. values. 1987. we plan to use a dynamicinterest oped by Bueno de Mesquita (Bueno de Mesquita and Stokman."In general. Mesquita and Stokman."It has been used withconsiderable success to in more than 60 countrieswith respect to more than 2. there have been criticisms of Bueno de Mesquita's expected utility theory(Simowitz and Price. Putnam. Deng also had realized that the war would bring China neithera great victory nor a disasterbefore he initiatedit.it still solves more empiricalproblems than any known theoryin the field"(Simowitzand Price.which makes predictionsabout eventsand policies whose actualizationhas not yet occurred. 1983. 1985. this study. on the rise to power of Yuri Andropov as a successor to Leonid Brezhnev in the Soviet Union. Newman. China's securitypolicy is determined by the relative power among internationaland domestic groups. Petersen. Bueno de Mesquita and Beck. Kim. Of course.5 endogenous to literature on two-levelgames thatsees foreignpolicyas partially domesticpoliticalconsiderations(Bueno de Mesquita.384 Assessing theDisputein theSouth China Sea (especiallyhis pragmatism.Therefore.and daring) and such internalfactorsas capabilityand Deng's leadership that China's interests.The 30 percent of failed objectiveswould serve as a stimulusfor economic reformbecause the PLA modernization(Chen. more fully Newman.1994) to address the expected resultof domesticpoliticalbargaininginside China on the Spratly Islands issue. He argued thatChina mightachieve about 70 percentof its war objectives. Salt Lake CityTribune. are on the righttrack. In other words. with information provided by the United States. confidence. would then realize the importanceof military 6JamesRay (1992) notes of Bueno de Mesquita's model that.even critics that. and This is broadlyconsistent withthe recent calculationsabout coalitionformation. Ray. Bueno de Mesquita and Organski. and the defeat Chinese governmentto crack down on pro-democracy of Daniel Ortega and the Sandinista governmentby the coalition led by Violeta Chamorro in the 1990 election in Nicaragua" (1992:160-161). 1990). a model. 1989. Bueno de Mesquita. The Method and Model We describebriefly discussedelsewhere(Bueno de Mesquita. Newman. Bueno de March 1.1984).forexample. 1994).in this group bargainingmodel develinvestigation. 1987.In turn. the rise to power of Hashemi Rafsanjani in Iran. 1989. Nicholson. saliency for the issues. though. Salt Lake CityTribune. Accurateforecasts have focused. 1985. March 1. 1981. of the theoryhave written 1990. Wagner. and Rabushka.

2.8 c. such thatthe sum of the capabilitiesof the participants settingis 1. as already noted. then. Black's theorem demonstratesthat the outcome desired by the just assumed promedian voter is the winning position under the constraints vided a simple majorityis required for victory.each decision maker is endowed withthreecharacteristics. let us first Each player analysis.Banks's monotonicity escalation of friction an importantfeatureof all politics.bounded for convenience between 0 and 100.and so forth. uixk. actor i's share of the in a multilateral decision-making totalpotential influencethat could be brought to bear in the negotiationsover 7xtais the outcome actor i has revealed to be preferredon issue a. attachessome utility to each possible outcome on issue a. i's utility for xk.so thatuixk = flXk. . An actor might be a governmentrepresentative. Each participantin the bargaining process is also endowed with the powerto exert some influenceon decisions. n} be the set of actors or stakeholders tryingto influence an a multilateraldecision. This simple statementturns out to have interesting and sometimessurprisingimplicationsfor politicalintercourse. Let cia be the capabilities(or power) actor i could bringto bear on issue a. k's proposal. Of the infinitely proposals to resolve some issue a. when policydebates theoremprovidesa basis forpredicting The monotonicity or are expected to lead to an are expected to produce negotiated settlements theobetween competing interests.the more likelyone is to undertake the challenge. a leader of some froma factionwithina politicalpartyor a bureaucracy. an influential let Ra be the line segment. interest group. but the reader is alerted thatthe model does 8Again. Let N = {1. Rather. iEN have its own resolutiondenoted as x. etc. G. Because the model as applied here assesses policydecisions on one actor to misrepresent issue at a time. b. 3. not assume an actor's capabilitiesor potentialpower is the same on all issues.. Two constraintsare assumed to facilitatepredictionand explanation: that issues are unidimensional. Let each actor i. m} be the set of issues in a multilateral negotiation and For any feasible proposed outcome on issue a. It may or may not be i's trueideal point. . withthat preferred preferred that on the issue continuum RaX0 c xr c 100.7 Let M = {a. c.we drop the "a" subscriptfromthe notationthroughout.. . that describes the unidimensional policy continuum for any individual issue a selected fromamong the largerset of issues M. is a decreasing functionof the distance between the proposal and many possible i's preferredresolution. In this To answer thisquestion. we assume that power is the nonvotinganalog of votes in most politicalinteractions.and that preferences(and associated utilities)for potentialoutcomes is from in Euclidean distancea possible settlement diminishsteadilythe farther of the median are requirements one's preferred outcome. These two constraints voter theorem. we drop the issue-denotingsubscript(a. b. such resolutionof issue a. so that preferencescan be represented on a line segment. . Xk. 1990). The conjunction of these theorems along with concepts from bargaining theory fosterthe development of a quasi-dynamic political model that includes detailed expectations about the agreements or compromises that various "players" are willing to make over time and the implicationsof those compromises for the ultimateresolutionof the issues in question.xrl. say. is. official privatecitizen. how are we to predictwhich will be chosen? learn a littlemore about each actori.) fromthe notation so that henceforthxl is the preferredpositionof actor i on the issue being evaluated at the moment. .SAMUEL S. . incentivesforan We generallydo not know for sure what another actor's true ideal point is as there are strategic his or her ideal point.It tellsus that the more one rem highlights expects to gain from challenging a rival perspective.Of course. WU AND BRUCE BUENO DE MESQUITA 385 litical disputes (Banks. we do not assume that all interestingpolitical problems involve voting.

uixk). thisarraydepends on forceson eitherside oftendeterminesvictory. The prospectthata proposal willsucceed is assumed to depend on how much support can be musteredin favorof the proposal as compared to the feasible In the model thisis calculated as the sum of "votes"across all actors alternatives. If vik is less than zero. another proposal. This sum equals vik with V0k = z dk (2) If vjk is greaterthan zero thatimpliesthatx. and if vik equals zero the competing interestsare collectively between the two alternatives." The "votes" presumed to be cast by actor i in a comparisonof alternativesxj and Xk are said to equal vk where: Vika I Xj Xk) = (Ci) (si) (UWXy - UXk) (1) Equation (1) states that the "vote" or power mobilized by actor i in a comparison of two alternatives(x.Consequently. room" before any formal. Such concessions or capitulationscan change the locationof the median voter. kEN.there are likely to be many more than two proposed settlements. si) and by how much i prefers discountedby how important ifyou like. When alternative courses of action are pittedagainst each other. the outcome preferred by the median voter (weighted by power. It depends also on the more than the relativepower of the competinginterests. and of preference)is found. one proposal to the other (uix.e. sometimeseven needlessly. In practice.the median voter positionis the predicted outcome (Black. k's (uixk). By pittingall alternativesagainst one another two at a time. In any negotiation. to which each actor prefersone proposed settlement. xj is expected to be defeated by indifferent Xk. or actor is any aggregationof individualswithidenticalvalues on all three of these variables. Barring perceptionsor beliefsthat lead deciintensity sion makers to switchtheirposition. say. i may attach considerable attachesto the issues that must be confronted. importanceto issue a and considerablyless importanceto issue b. with willingness to spend influenceon the issue in question [si]and the intensity say. salience. player.itis crucialto providean accounting of when such switchesin position are expected to take place. Denote the salience of issue a for actor i as sia' with0 c sia c 1. Each actor is described by the values of uixkfor all i. withthe expected If an interestgroup is dissatisfied it can alter its own level of effort(i. A group. The "voting"scheme reflects. selectingxi such that uix* =# uixi.. defeatsXkbecause the tacitcoalition in favor of j's proposal is more motivated and powerful than the coalition supportingk's proposal.of course.e. shiftits revealed position. outcome of a negotiation. and si on each issue. Each group has a total number of potential "votes. or influencethose who are willingto make concessions to the focal group so that those other groups alter their level of . Each participanthas its own agenda of priorities Thus.j's proposal (uix.the arrayof Of course. . in a comparison between xj and Xk.. change si).visible dewhat takes place "inside the smoke-filled cision-makingprocess occurs. ci.). perceptionsor beliefsoftenlead decision makers to grant concessions or to give in to a rival's point of view. and Xk) is equal to the potentialcapabilitiesof i the issue is to i (i. It assumes that any formal process echoes the agreementsreached beforehand. 1958).386 ChinaSea in theSouth Dispute the Assessing or saliencethatit some issue a.

thatj does In doing so. not care enough about the issue to resistthe proposed settlement i also considers the possibility thatj will resisti's proposal (sj). withd denotingthe failure is estimatedby projecting to challenge or make a proposal. This expected utility what the relevantdecision maker believes is likelyto happen in the absence of the exertionof pressureon a rivalto persuade the opponent to alteritsbehavior.I d-EiuiAxj I d (5) and i is own.e. which equals the prospectof having to abandon its u (xi-xj).d> uiL\xf Id. each other actor. in which case there is some chance the policies ofj are anticipatedto get better(with (Ti) that. actors take the expected actions of third vis-'a-vis is superior to not challenging it and so i is assumed to make a proposal of its If equation (5) is greaterthan zero. theni believesthatchallengingj's position . leading to switchesin positions. i may anticipate the preservation of the statusquo betweenitself thatj's position on the issues will change.sj). This is denoted by uiAxj I d. Should i fail. then i is indifferent Each actor evaluates equation (5) and not challengingj's proposed settlement.I d). or it can influence those who are willingto make concessions to the focal group so that those other groups alter their revealed position Xk so that ukxt # ukxk. i's expected utility is described as: each player's expected utility from chalienging or not challenging the policy a d = QiuiAx?I d + (1. then i will derive the utilityassociated with convincingj to switchfrom its current policy stance to that supported by i. uiAxt I d being the associated utility) or to get worse (uiAxj. If equation (5) is less than zero. . givinggroup i the ability andj (uiAxjId). The expected utilityfor i from not challengingrivalj's positionis denoted as EiuiAxjId. jEN.Pi) [ui/x7 Id]} + [1 .sj] [uiALx+ I d] (4) EiuiAxjI d = sj{Pi[uiAxj+ of i withrespect toj's outlook on issue a is: so that the overall expected utility Eiuixi\ = EiuiAx. decision makersare assumed to calculate the expected consequences of challengingand of not challenging alternativeproposals. Sk). examine all possibilities.fromi's perspective. In doing so. Although in the model we here we focus only on the latterone. In the model envisioned here. for challengingj's proposed resolutionof the multilateral The expected utility dispute (EiuiAxjI d) is: I d] + (1 .Pi). denoted by uiAxj-I d = ui(x. in ascertaining what leverage theycan exertcould Decision makersinterested the beliefsheld by each other actor.then it confronts objectives in favor of those pursued byj. in which case to enforceits wishes on there is some likelihood thati will succeed in its efforts j (Pi) and some probabilitythat it will fail (1 . ci-used to estimate proposal backed by each potential rival and for approximatingthe expected utility each actor i believes its rival expects to derive fromchallengingor not challengingthe policy goals of actor i. si. To do so requires benefitfromestimating a focus on the three characteristics-ux. G. One of three contingenciesmay arise: actor i may anticipate that with some (Qi) rivalj will not alter its currentpolicies over the time period of probability it receivesfrom to derivewhateverutility concern to i. then not challengingis preferred betweenchallenging said to be deterred. for all i.Qi) [Tiuilx+ I d+ (1-Ti)uiAxfld EiuiAx 1 (3) i can challengej's position on issue a by proposing a change in j's position.SAMUELS. Should i succeed. WU ANDBRUCEBUENO DE MESQUITA 387 effort (i.xi).If (5) equals zero. so that uiAxJ+ ifitleavesj's proposal unchallenged d > uiLAx.. actor i presumablytakes into account the probability by i (1 .

In particular. and (3) j's expected utility vis-a-vis (4) j's perceptionof each i's expected utility j's proposal. 1994). The perceptionsof each actor as illustrated by Figure 1 implyactions.it is possible to estimate a complete matrixof expected utilitiesthat captures all possible confrontations. along withrelevantlabels foreach of the six sectors. Bueno de Mesquita and Lalman. reflecting likelihood of alternativeoutcomes in accordance with Banks's monotonicity theorem.the higher the likelihoodthati will confrontj. As stakeholdersrespond to revised proposals. j makes a comparable calculation (as does each kEN).Beliefs and expectations provide the foundation for a quasi-dynamicassessmentof the evolution of issue positionsand forrecalculationsof the location of the median voter. Newman. we By examining the distribution of information available to each participantin attemptto approximate the privateinformation a dispute or negotiation.in the form of the extractionor grantingof concessions over support for this or that specificposition. Bueno de Mesquita. 1990. with relevantsuperscripts on equation (5) indicating from whose perspective the calculation is being viewed: (1) i's expected utility each rivalj's proposal. a space intosix sectors. Equation (5) is estimatedfrom four perspectives.Those actions.388 Assessing the Dispute in theSouth ChinaSea parties into account. in graphs like Figure 1. Coalitionschange and the supportor risksassociatedwithalternative proposals vary. a fundamental withtheboundarybetweeneach reflecting turningpoint in the probability functions. 1986. these relationshipscan be described in continuous form.lead to a reevaluationof the situationby each decision maker. When actors are persuaded or coerced into accepting a proposal different fromtheirinitial(or current)positionon an issue the decision process entersa new phase. and Rabushka. so thatthe higher some actor i's expected utility is with regard to persuading some other actorj to accept i's position. 1985. The measurementprocedures foreach term are explained in considerabledetail elsewhere(Bueno de Mesquita. The estimatesof Pi include calculationsof how i expects all other parties to respond to a dispute over policy settlements between i and j. With Banks's monotonicity of escalation theorem in mind. Because equation (5) includes such subjectiveelements as utilitiesand subjectiveprobabilities. or unfavorable settlementchange for many participants. with their rethe prospectsfora favorable sponses supportedby theirbeliefsand expectations. The likelihood with which confrontation or concessions occur can be easily we divide such displayed in a polar coordinate space. New proposals are brought forwardas revised beliefs and ex- . The expected utilityvalues summarized in (1) and (2) and in (3) and (4) respectivelydescribe each actor's perception of its relationshipvis-'a-vis each other actor.From thatinformation we estimatehow each partywill behave and what consequences are likelyto ensue.or in a neutral position as indicated by each third party's preference for i's policy proposal or j's.Figure 1 displayssuch a coordinate the general space.j's coalition.According to Banks's thea given rival orem. The various componentsof equation (5) musteach be measured if the model proposed here has practicalvalue. (2) i's perceptionof each j's expected utility vis-a-vis each i's proposal. the probability withwhich an actor anticipatesconfronting increaseswithits expected utility forchallengingthe rival'sproposal. Bueno de Mesquita.Pi places each other actor in i's coalition. Bueno de Mesquita and Stokman. 1985. vis-'a-vis vis-a-vis i's proposal. For ease of presentation.and capitulationsamong all the participants in the relevantpoliticalarena. compromises.

If i expects to lose to j. each player decides on proposals or bids to make to the other decision makers. thinkof the decision makersas being engaged in a game of cards. Because of variationsin salience. With that information.i thinksit holds a good hand relative to j then i makes a proposal in the form of a suggested change in positionbyj on the issue at hand. If. 1.each playeris dealt a hand.Based on the cards theyhold and the known characteristics of other players. WU AND BRUCE BUENO DE MESQUITA 389 Expected Liains FOCAL GROUP \ OFFERS Compromise CONFRONTATION EXPECTED BY BOTH SIDES EU(Focal Group) Expected Losses FOCAL GFOP GIVES IN\ RIVAL OFFERS Expected Compromise Gains BOTH SIDES BLUFF/POSTURE Status Quo RIVAL GIVES IN Expected Losses EU(Rivals) FIG.Stronger players (or those with strongbacking fromothers) generallydraw bettercards than weaker players. then no proposal is made to that actor. The model portraysa process of decision making during each iteration. G. for instance.each decision maker formsperceptionsabout how good the hand is of each rival relative to the hand dealt the particulardecision maker.9 If i thinksj stands to lose quite a lot. then i 9i makes a proposal if. or fallsbetween 270 degrees and 360 degrees . some playerspay closer attentionto theircards than do othersand so formdifferent perceptionsof the situation.The model computes as many iterationsas it takes for the policy issue to resolve itselfby reaching a stable outcome.SAMUEL S.To gain an intuitivesense of what happens withinthe logic of the model during each iteration. pectationsopen new possibilities or forecloseold ones. If a playerbelieves his or her hand is veryweak compared to a specificrival. however. an outcome fromwhichthereis not a meaningfulpossibility of change given the estimatedexpectationsof the actors. the conjunctionof i's expected utility and i's estimateofj's expected utility fallsbetween zero degrees fromthe horizontalaxis and 45 degrees. then i does not make a proposal toj. The qualityof the hand dealt to each playerdepends on the commonlyknowncharacteristics of each player. Each such sequence of revised stances on an issue is called an iteration. At the outset.in Figure 1.

At the end of a round of proposal making. Those betterable to enforce theirwishes than others can make theirproposals stick.i expects resistancefrom it can enforceits demand. playersmove the least thattheycan. but i believes the wedge between zero degrees and 45 degrees. In the formercase. each playernow reviewsthe new cards-the proposals-that it holds. for instance. whetherthey involve intra-or intergovernmental or negotiations betweenpublic and privateorganizationsor even withina single can be and have been predictedusing the model delineated above.'OIf i thinksit has a good enough hand to shiftj's position. something that the proposer might only learn at the end of the round of proposal making.each shifts sorting to the position contained in the proposal it accepted (if any). some proposals turn out to be frivolousin that the proposer cannot enforce the proposal. then a player learns that it made the best offeramong all the proposals made to the recipientof itsaccepted bid.e. i expects no resistancefromj. players learn new information about their opponents. Each actor selectsfromamong the bids it made and the bids it receives. When the playersfinish out theirchoices among proposals. Estimatingthe Model's Results: Developing the Data relations Political outcomes. If.390 Assessing theDisputein theSouth China Sea will propose thatj accept i's currentposition.but not so good thatj will give in to what i wants. however. Of course.a player finds that some proposals it rejected then it learns the proposal thoughtof as enforceable are successfully was unenforceable(i. Given equally enforceableproposals..ll Afterall the players have submittedtheir secret proposals to one another. . These constraints tions and the realityof which proposals turn out to be enforceableand which turn out to be beaten back by rivals or rejected outrightas unenforceableby the recipient. organization. If a proposal is accepted. For a fuller descriptionof the sequential process in this game we suggestseeing Bueno de Mesquita and Stokman (1994). To do so.The bid that is chosen is the proposal that is the optimal choice for the player given the include its own percepconstraints under which it operates.Indeed.but fall by the wayside because a superior. Other proposals received by a decision maker are potentially enforceable. and each proposer enforcesits bids to the extentthat it can. The median voter of the final stage of the game is the predictedpolicy outcome.By monitoringresponses to its proposals a player learns how much leverage it has with other decision makers. requires convertingtheoreticalconcepts into practicalap- fromthe horizontalaxis. Each playerwould like to choose the best offer made to it. some proposals are betterforthe recipientthan others. "1A compromise is proposed if i believes the conjunctionof the relevantexpected utilitiesfalls between 315 degrees and 360 degrees fromthe horizontalaxis in Figure 1. 10A proposed capitulation by j to i's wishes is made if i locates the conjunctionof the respectiveexpected utilities in the wedge that fallsbetween 270 degrees and 315 degrees below the horizontalaxis in Figure 1 or in j. the player has less support than it thought). That is the domain withinwhich i believes it has a comparativeadvantage overj and i expects more gains than losses fromchallengingj's position.then i proposes a compromisesomewherebetweeni's positionandj's. The game ends when no player believes it has a remainingcredible proposal or the value of small that the cost of continuingto bargain remainingproposals is sufficiently outweighsthe value for each player of the expected improvementin the outcome.enforceable proposal was made by a different player. In the latterinstance.

and how much do theycare about the issues in question). 1992b. other sunk costs. difficult plication.in instituit is also importantto take into account structural tionallystructuredsettings. The team searched through several withinthe Chinese leadrecentpublicationsand documentson politicalfactions groups (Lee. Yu-guo Chen.data mustthenbe estimatedon threeand onlythree variables: capabilities. World ershipand theirassociated interest He is 12Dr. Wu he was not asked to provide an answerto the above question. Withjust this minimalinforregarding. thereby ized data set.or withouteven interviewing to assess theirown judgment about theirbeliefsand expectations. Forecasting Chinese Foreign Policy: The Data The data forour analyseswere obtained fromseveralsources duringthe period data collectionrelies on betweenearlyJune and earlyAugust of 1992. G. The issue forwhich we sought data is: fromthe economic What level of resourcesdoes each group supportreallocating capabilitiesin order to respond to challenges from reformprogram to military in the South China Sea.and standardcreatingthe first salience thateach actor attachesto the issue. Ellis.the history the actorsinvolved the situation. Dr. Sometimes. Alexander Tan and Mr. particularly several fieldstudies in southernChina and is therefore 131t should be noted that the United States governmenthas found that there is substantialconsistencyin given thatexperts model predictionseven as the expertsprovidingthe data inputsvary. he was asked to identify the stakeholdersor actors withan interestin shaping Chinese policyregardingthe issue at hand. constraints that operate to help shape outcomes. Surelysomeone who is not an expert on the issue. second data set is based on research done by Wu and two of his assistants.National Chang-Chi University. Cheng-chi Chang and his associates have investigatedthis issue in great by Samuel detail.SAMUEL S. G.Chang is the Chair of the Graduate Programon Labor Relations. and without of relationsbetween particularactorswithin history of the situation.Although thiscan be an extremely a body of knowledge that can be called upon to estimatethe criticalvariables. The A second estimationof the same data was done as a reliability Mr. mation in hand. Cheng-chiChang was interviewed S. The first the expertiseof Dr.13 check.thereis. what is theirrelative are asked verybasic information potentialto influencethe process.when Dr.for instance. 1987. does not know thisinformation . fortunately.This is not too surprising only (who are the interestedparties. the any other information. assumsmallercountriesand to secure China's interests ing that any such challenges are expected to be on a small scale withno superpower involvement? Dr.12Nevertheless. groups on China's policymaking(especiallyon labor policy).it is possible to predictwhat the likelyoutcome will be.He has conducted an experton the impactof interest familiarwiththe interest groups in thatarea. and salience.what do theywant. 1992a. WU AND BRUCE BUENO DE MESQUITA 391 task. of the The forecastingand perceptual models require the identification to influencea policyoutcome on the issues groups or actorsinterestedin trying in question.preferredoutcome. Cheng-chiChang and his associatesat the National ChangChi University. Rather. Cheng-chiChang was also asked to use his expertiseto estimatethe relativecapabilitiesor power. model with the knowledge By combiningthe perspectiveof this rational-actor it is possible to estimatethe variables of and expertise of area or issue experts interestand to solve the perceptual and "voting" components of the model discussed here. position. For each actor.

Chen was a lecturer at the Department of InternationalRelations.S. interests 70 = Prepared to use a naval blockade only to advance territorial in the South China Sea.navy. asked to provide the basic data needed by the model to evaluate the issue.392 theDisputein theSouth China Sea Assessing Journal.and air forcesto protectterritorial ests in the South China Sea. Data Assumptions Position 81 76 70 66 62 59 56 54 47 43 25 17 Salience 30 75 70 70 80 50 85 20 80 75 85 90 TABLE Capabilities GENPOP3 DENG GUANGDONG PLA2 USOIL PLA3 SWMILIND GENPOP4 GENPOP2 CHEN YUN PLAI GENPOPI 40 100 30 80 3 25 5 60 10 35 10 3 '4World Journalis the biggest and most prominentU. Wu's field studyvisit to China took place in October 1992. The scale of policy preferencesfor the data in Table 1 is interpretedas follows: 0 = All resources should be reallocated fromeconomic reformto military purposes even though thiswill mean a delay in economic reform. before he came to the U. Chen are Ph.but no ground troops. 1. 76 = The statusquo. The data are reported in Table 1.'5 The few differencesin estimationsbetween the two data sets were then resolvedthroughdiscussionsbetweenthe two groups of experts.Therefore.S.-based Chinese newspaper. indicatingthatthe challenge should onlybe dealt with operations.Mr.S. 47 = Prepared to use navy and air forces. Peking University. Tan and Mr. students.14 Wu also went to China for one month of fieldresearch to fosterdevelopmentof the second data set. It actuallyprovides more accurate information than do the newspapers in mainland China since the latterare operated and censored by the state. Again.1991-1992). inter25 = Prepared to use army. Tan workedon issues concerningChinese economic reform at a noted economic research institutionin Taiwan for several years before he came to the U. 15Chinesesecurity policyformation has been one of Wu's researchinterests forsome time. neithergroup but ratherwas was asked to provide an answer to the question we are studying. conflict insteadofeconomic 100 = No resourcesshould be allocatedto military operationsin the South China reformso thattherewillbe no military Sea.D.but no actual military area.Both Mr.the finaldata set representsthe consensus of the two groups. Mr. . throughlimitedmilitary operations in the 81 = Enhanced military readiness.

an assessmentof the reliability made with the model are robust across expertseven if the assumptionsof the relevantactors are divergent. we should allocation of resources formilitary of the groups is on the data presentedin Table 1. testswere conducted and all pointed to the conclusion that the resultsof the analysisare robustagainst plausible measurementerrors. Some China specialists.e.SAMUEL S. In other words. is the great differencebetween the concentrationof potentialpoliticalinfluenceand the realized utilizationof politicalinfluenceon that difference. contendinginterests of expertshas found thatthe predictions Second.only when thejudgment of a collectivebody of China expertsturnsout to be wrongbyabout ten times. representsa tenfoldincrease relativeto our data set. As is evident fromTable 1. Figure 2 highlights substantialamounts of money Stakeholderswith an interestin transferring collectively away fromthe economic reformprogram and toward the military possess substantialpoliticalinfluence. capabilitiesdiscountedby salience) as a function median "voter" line crosses the power or capabilities variable at position 66. One mightlegitimately at how reliable the data are given thattheyare based on the personaljudgments of a few specialists.we have testedthe impacton our resultsthatwould arise ifthe SouthWest military-industrial complex actuallyhas capabilitiesanywherein the range units. complex in our data the factiondescribed as the South-Westmilitary-industrial set may be strongerthan our expert evaluatorsindicated. indicating support for a somewhat more aggressive foreign policy. the model's successrate of 90 percentin predicting suggeststhatexpertsprovidereliabledata mostof the time. but the does not achieve the statusof the median "voter" utilized power configuration until position 76.The (i. sensitivity analysiscan be-and has been-conducted to determinewhetherthe resultsare robust or are altered by small changes in the data assumptions. perhaps. Figure 3 displays the cumulative political power and utilized political power of policypreference. whichis veryunlikely. The expected utility analysisprovidesdetailsconcerningthe resolutionof the .Third.of of 5 units (as indicated in our data set) to 50 units on our scale. the model proves to be significantly accuratethan do the veryexpertswhose inputswere used (Feder. Several similar sensitivity are the results of our analysis altered significantly.However. there is a wide diversity Less evident. position. a posture that is equivalent to the maintenance of the statusquo.and salience of the groups.Four points are worthnotingin thisregard. policychoices among First. Forecasting China's Policy: An Illustration of the Method of opinion on this issue. The identity commentbriefly explained in the Appendix. analysisdemonstratesthat our analyticresultschange meanThe sensitivity complex ingfullyonly if the capabilities of the South-Westmilitary-industrial are as large as 50. when preexperts about how to identify dictions from the model differfrom predictions made by the experts who more precise and provided the input data. thisquestion. As part of our data evaluation procedure we have tested the robustnessof testingcentered on the most controversial our analyticresults.As this conjectureis plausible.theyare much less willingto use theirinfluenceon this issue than are those who are more disposed to maintain the status quo or even increase support for the economic reform program. Finally. 1987). G.have suggestedthat aspect of our data set. Fifty course. WU AND BRUCE BUENO DE MESQUITA 393 Before turning to our analysis of China's anticipated policy affectingthe purposes in the South China Sea. It is evidentthat there is considerablevariationin wonder the power.The sensitivity forinstance..

Power l l L *75 . 1I E UsePow l li ...25 - theDisputein theSouth China Sea Assessing UsePow L CD .25 | l l l l i 17 25 43 Policy Preferences 47 54 56 59 62 66 70 76 81 FIG. Will the PRC Use Force? CD) ?~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~.394 .....2- 3 15- ? 17 25 43 Policy Preference 47 54 56 59 62 66 70 76 81 CD FIG.Il. 3. 2. Support for Resource Transfers ...

are a major instrument instigatea successfulnaval blockade. thatmoves fromactivist (position 70 on the harassmentor intervention but withoutadditional military assessmentindicates a policy scale). Submarines.each group hypothesizedto be relevantto the issue-as definedin the Appendix-is located at what China experts have identifiedas their current and the formation in positions. If the report is correct. WU AND BRUCE BUENO DE MESQUITA 395 issue that cannot be gleaned fromthese two figures. . afterconsiderable internaldebate. The Prospectsof Military Engagement over the SpratlyIslands Ti 81 76 70 66 62 59 56 54 47 43 25 17 66 T2 70 75 71 75 70 64 66 61 43 49 66 62 70 T3 69 73 73 73 71 70 67 63 66 52 67 62 73 T4 72 73 73 73 73 73 67 72 66 56 67 69 73 TABLE Group GENPOP3 DENG GUANGDONG PLA2 USOIL PLA3 SWMILIND GENPOP4 GENPOP2 CHEN YUN PLAI GENPOPI FORECAST 16Asnoted earlier.however.then. of coalitions. In the first using the dynamicversionof the expected utility predictions picture. China has denied the action.SAMUEL S. However. China's policywill settledown to an equilibriumabout equivalent to the currentstatus quo.resulting tweenhard-liners to an endorsementof some actionlike a naval blockade.Gradually.consistentwith Figures 2 and 3. and with forecastis that internal the currentstatusquo equal to 76.willquicklygiveway to a more moderateposition. With thatin mind. It is of some interestto note how the competing interestsare expected to evolve over time. more activist We expect that the internalbargaining process will lead to a compromisebein supportfora policy and more moderateelements. Although that policy will not be without stable. the intermediateexpected utility than the currentstatusquo.further. it will prove to be fairly significant detractors. it demonstratesthat the policy predictionwe presentedat the meetingsof the American PoliticalScience made in August 1992 when thispaper was originally Associationis consistentwithsubsequent developments. that China is expected to become somewhat more militarily active in the shorttermin promotingits claims to the SpratlyIslands than has been true up until now.predictedbythe initialphase of thedynamicexpected utility The thirdand fourthsnapshots show the equilibriumpositionsat which each group is expected to settle for the time being.Table 2 providesfour snapshotsbased on model. G. position.there are recent reportsthat China has sent three submarinestojoin its naval fleetin the for China if China hopes to area. Each snapshot. the expected utility incline China towarda policyinvolvingat least a naval Chinese debate will first blockade and perhaps air or naval harassment(position 66 on the scale). willprove difficult forChina to sustain.The second snapshotindicatesthe shifts model. denotes a phase in the sequence of internalbargainingthatwilltake China fromitscurrent 2.We find.16 more activist thatis slightly more activist profile onlyslightly We find. withall-outwar being equal to zero. thateven the intermediate. This stance. then. That is. On a scale fromzero to 100.a coalitionpolicywillemerge to reassert the current status quo.of course.

396 theDispute in theSouthChina Sea Assessing policytowardthe SpratlyIslands to a more aggressiveposture and then back to the statusquo ante. situation. pressing him to accept Deng's policies would fosteran even broader based Chen Yun's Perception: Outset GENPOP2 AMOILSWILIN GENPOP4 PLA3 PLAi DENG PLA II GUANGDO GENPOP3 GENPOPI EU(ChenYun) EU(Rivals) FIG. Figure 4 clearly weak position indicates that Chen Yun perceives himselfto be in a politically actors. In particular. Chen Yun. Most notable among the perceptual highlightsis the unrealized potential among Deng Xiaoping's supportersfor promotinga stillless aggressivepolicy than that which will be implemented.it appears that Chen Yun believes that he can do no betterthan to give in to Deng if he is pressed to do so.Recall that the interpreis done in accordance withthe tationof the figuresthat depict these highlights sample guide provided in Figure 1. 4. The dynamicsunderlyingthe emergence of the predictedequilibriumhighlightinteresting featuresrelated to actor perceptions. His in actuality.according to the logic of the expected utility assessment.Insofar as Deng's positionis somewhatmore moderate than the statusquo and Chen Yun is a key center of power among the hard-liners. he otherwise sees himself as embattled. While the conservative Deng as well as other reform-oriented vis-ai-vis Chen Yun believes that he has real influenceover those segmentsof the population that are extreme nationalists(GENPOPI) or that have already benefited from currenteconomic reformprograms and are afraid to rock substantially the political boat (GENPOP3). is betterwithrespectto Deng than he thinksand is more complex withregard to the general population than Chen Yin recognizes. . Figure 5 reveals how each group views its own situationvis-'a-vis betweenChen Yun's Most intriguing froma policyperspectiveis the difference withDeng and Deng's view of the same anticview of the expected interaction ipated interaction.

That Deng will not press weaken the anti-economic to further means thathe will forego the opportunity reform hard-liners. It appears that the big winnersamong Chinese elitesare Deng Xiaoping and the leaders of Guangdong. While the model proposed here could be used to simulatethe impact on this policyquestion thatDeng's death (or Chen Yun's) would have. WU AND BRUCE BUENO DE MESQUITA 397 moderation. G. relationshipsbeing tense and conflictual. .tempersseem to calm down. In the final iterationof the model. however. Chen Yun would give in Deng's objectives. This misperception As we saw in Figure 4. the current however.According coalition of support for economic reformand military Chen Yun is one vis-'a-vis to the model. 5.Deng believes his relationship concessions thatwilllead to a stalematein whichit is best not to press forfurther greater opportunity to consolidate in a foregone results (Figure 5). 35 percent of bilateral relationsare conflictual. At We also findthatthe SpratlyIslands policyis fraught the outset of our assessment we find that 37 percent of the bilateral group involvethe prospectof veryhigh tension. in whichthe compromiseagreementat 70 icantly by the first mode. withinternalconflict. support behind and accept Deng's policy if he were pressed to do so.thereby possiblyjeopardizing the future viabilityof his programsonce he has leftthe scene. such an assessmentis beyond the currentscope and objectivesof thisinvestigation.witha returnto approximately level of tension.This is mitigatedsignifrelationships bargaininground. The leaves about 29 percent of the relationshipsin a confrontational in this interreflected press to withdraweven the small concessions to activists mediate forecast is expected to result in 45 percent of the internal bilateral Once the statusquo is reestablished.SAMUEL S. They are at the core of the winningcoalition.while Rival's Perceptions About Chen Yun: Outset GENPOP2 SWM [LIN PLA3 GENPOL Ai GENPOPI OENG DENG GUANGDO ~ PLA2 AM01t GENP 3 Yun) ~~~~EU(Chen EU(Rivals) FIG.

such specialists.which are also consistentwith in disputes.straforinstance. A similarperspectiveis found in Gurtovand Hwang's (1980) evaluation of China's participationin the Korean War and in Segal's (1985) observationthat its military goals.In the context of a prospective conflictwith Taiwan. Conclusions The approach to analyzing Chinese politics taken here representsa methodThe technicalnature used perspectives.of course. Specialistson China should be somewhat reassured thatthe formalmodels approach we have taken is capable of yielding body witha significant insightsinto China's futurethatare generallyconsistent we hope. of China's foreignpolicy from Shih and Adelman (1993) look at the history 1840 through1980. will'require updating of the analysisfromtime to time.Certainly in Chan (1978) and Whiting(1975).it is not sustainablegiveninternalChinese pressures.We have made quite explicitour assumptions about rationality in Chinese policyformation. Based on our analysis. Moorer believes thata blockade of Taiwan war withthe potentialto spread would immediately escalate into a full-fledged throughoutthe region. Others. ologicaldeparturefrommore commonly and others make China specialists and appropriately of the analysiswillnaturally somewhatskeptical.At the same time. will of more conventionalanalysis. and otherpointsof view be intrigued betweenour predictions by the differences and by the practicalpossibilities our approach holds out for predictingfuture events and for explaining those events in the contextof strategiccalculations and motivations to gain politicaladvantage. for instance. China has alwaysbeen flexiblein determining In contrastto our model-based predictions. relies on the . The accuracy of the predictions. They argue thatChina tends to dramatizeitsforeignpolicy the controlling in many disputes while carefully by participating determination withthe patternsis quite consistent Their assessmentof historic level of conflict.Chang and Lasater (1993) believe China's approach is to threatenTaiwan withforcein order to obtain greaterbargaining leverage in the future.398 theDisputein theSouth China Sea Assessing are the biggestlosers. more than fiveyears fromnow). of course.This means thatneitherthe United themselves verymuch about constructing Statesnor regional powers need worry ambitionsconcerningthe a policyoriented toward deterringChina's territorial SpratlyIslands or related disputes in the near future. the controversialnature of our predictions. fears of expanded Chinese militarism Althoughthe prospect of such behavior is enhanced in the shortterm. Godwin (1993) contends that China is likelyto use a while former chairmanof theJoint blockade of Taiwan to compel reunification.Yet our conclusionsabout the low prospectsof a war over the SpratlyIslands are rather consistentwith previous Chinese foreignpolicy and withmuch scholarshipon the subject. tegiccalculationsbytheleadership. Chiefs of StaffAdmiral Thomas H. share this convictionthat China's policies are shaped by rational. such a viewis reflected.we are sanguine that China is engagementat thistime.What the more distant futurewill bring (say. not prepared to risksuch a level of military It is reassuringthat our findingsare echoed in a substantialbody of earlier researchon China's foreignpolicy.Our assessmentsuggeststhat Chen Yun and his followers in the South China Sea are misplaced.there is considerable several analyses of past Chinese involvement that highlights a diversity diversity of opinion about China's futureintentions.though using less explicit models. Some limitations of the model discussed here should be mentionedbeforewe conclude this study. we make regardingthe currentongoing dispute in the South China predictions Sea.

specifications to flareup into a significant The SpratlyIslands dispute appears to be unlikely source of violentconflict in the South China Sea over the next few years. the approach data assumptions.the United States would almost certainly be called upon to act as the principalsource of deterrence. preferences.we hasten to add that the reliability of predictionsmade with this model over the past decade gives us reason to expresssome confidencein the model. th-e the expertiseof those who specialize in particularregions basis for integrating or problemsand those who specialize in the analysisof decision making. We believe there is room for improvementin this regard. G.definingwhat level of military operation) adventure to respond should be reallocated fromeconomic reformto military to challenge(s) from smaller countries and to secure China's interestsin the .SAMUELS. in recognizingthe underlying the expertiseof area specialists model provides a position. What is more.Interestingly. and structure of power. Appendix: Description of Positions and Groups Issue Definition: What level of resources (therefore. not only for those in the region. China's response will be a littlebit more but the response will not aggressivein the near futurethan it has been recently. of course. To the extent that one might doubt the validityof the data. In the event that changing circumstances or a changed leadership in China should produce an alterationin the situation.ifany. we would hope to revisitthisissue and reanalyzethe prospectsfora stable Chinese policyusing the framework suggested here.The takenhere providesa useful tool forassessingalternative data assumptionsto test the model can.Since reformersin China will have a much betterchance to implementtheiragenda. This ensures comparability input assumptions. The analysis indicates that. be resolved with different robustnessof the currentresultsor to evaluate the impact of alternativeviews on the fundamentalstructure of policy making in China (or elsewhere). WU ANDBRUCE BUENO DE MESQUITA 399 accuracyof the input data. Some testsofjust these questions of robustnesshave been reportedin our analysis. therefore.if challenged. At the same time.of alternative thismodel turnsout to be quite robustin itsresultsin the face of quite different and salience. This report.can be seen as an invitationfor experts on to analyze Chinese affairsthrough Chinese security policy to join in the effort the use of such models. specifically on the impact. the method used foracquiringdata.That is certainlygood news. policies that are expected to prevailin the near environment emphasize a stableinternational future. so that different introduce alternativeassumptionsabout the funscholars will not unwittingly of decision makingwhile using an approach such as the one damental structure and allowsus to focus across analysts suggestedhere. We see no reason to believe thatChina will undertake a big policy shiftand become more aggressive. One of the more encouraging aspects of this type of modeling is that all of the assumptions behind the analysis are explicit and fixed. of stakeholders. Such holds out promise of more comprehensivepoliticalanalysisthan an integration on their or area specialists been possible by eitherdecision analysts has generally own in the past. but also forAmerican foreignpolicy makers. theirpower. diversion of be so much more aggressive that we should expect a significant capabilitiesrelevant resourcesaway fromeconomic growthand towardmilitary to disputes in the South China Sea.and salience on specifiedissues.In the event of such exogenous eventualities as the death of Deng Xiaoping.

the uncertainty created by a war mightchange theirdisadvantaged power positionvis-'a-vis the reformers. In turn. 1992:4). ForeignMinister Secretary JiangTse-min. a combination of a naval blockade and economicsanctionmightbe. PLA3: This group includes most of the naval forces. June 25. 1992:4). but he cautions that China will respond with force if threatenedmilitarily.Many of these officers are under the threatof losing theirjobs withlittlechance to transfer to otherjobs (World Journal. August 18. Guangdong ProvincialGovernmentand the Guangdong Military Region: This group includes the population in the Guangdong area.and the PLA reformgroup led by Yang's youngerbrotherand Chief of the General Staff.Second. August 15. 1991:1) Yang was quoted as sayingthateconomic reformis the single most importantpriority forChina.Li Peng and Qian (World Journal.400 Assessing the in theSouth Dispute ChinaSea South China Sea? (The assumptionis thatthe challenge(s) will be mostlysmallscale one(s) and there will be no superpowerinvolvement.August 18 and 19. They believe thattheywould benefitfromconflict against other countries. Li Peng was also quoted as sayingthatit is not China's intention to be a hegemonic power in Southeast Asia (World Journal.PLA2 includes the National Chairman.aged fromaround 50 or older. In a news report(World Journal. 1992:4). represented by the leadership of the provincialgovernmentand the military region. 1992:4). They are the losers in the process of economic reform. accordingto Yang.Prime Minister Qian Qichen. Chen Yun was quoted as saying that economic reform is important but it needs to followthe Chinese model of socialism(World Journal. They are big .The Navy has been a big winner in China's recent increases in military expenditures for technological improvement. sizable conflict in the South China Sea would further boost the perceptionof the importanceof the Navy. the bestresponse (WorldJournal. 1992:4) were quoted as saying that China needs a peaceful international environmentto embark on vigorous economic reformprograms.June 12. PLAI: This group includes the People's LiberationArmy's(PLA) professional officers in the middle and lower ranks. forat least tworeasons. a seriousmilitary conflict would change the policypriority and emphasize collectivism instead of individualism. This group advocates the peaceful resolution of any territorial dispute with neighboringcountries. Chen Yun and Supporters in the Party: Led by Chen Yun. May 13.General Chih Haotien (World Journal. Their level of respect has declined primarily because of social changes brought about by the success of economic reform (World Journal. In addition. 1992:1). 1992:4).it would help the Navy to obtain even more resources. This group does not oppose expanded military conflict in the area.) Groups and Positions: Deng and Reformers in the Party:This group includes Deng Xiaoping. First.It is believed that there is quite a followingbehind this faction. theyhave voiced concerns about the ill effects of economic reformon the PLA's fighting capabilityand on the morale of theirtroops. If challenged in the South China Sea. Yang Shangkun. PLA2: This group includes those high-levelleaders in the PLA who support Deng's economic reforms. July 1. and others. this group is the conservativewing of the Communist party.For instance. October 10. General Li Peng.As long as a military conflictdoes not escalate out of control.

Foreign challenges serve as vivid remindersof the humiliating history of imperialinvasionsof China by foreignpowers. The war should be serious enough to deter othercountriesfrompossiblychallengingthe cantract(s)again. company(ies) would prefera peaceful. However. WU AND BRUCE BUENO DE MESQUITA 401 Journal. General Population 2: This group includes those who have a strongsense of nationalism but are not as fanatic as those in the GP1 (about 3-5% of the way. They can. stable environment However. but should not be so out of controlthat the oil explorationis jeopardized. They preferChina to respond in a limitedbut forceful limitedconventional war involvingno more than two branches of the armed forces. however. The territorial disputes in the South China Sea are not theirprime concern. General Population 3: This group includes those who have benefited from economic reforms(about 40% of the population. and (2) to increase theirpower throughthe resources gained frommilitary preparationsand operations. winners because of the economic reform program (World 1992:4).Withoutsuch a mobilization. .SAMUEL S.they have become less and less controlled by the political center in Beijing.There are two reasons theywould findsuch a limitedmilitary fromthe exploration engagementacceptable: (1) to secure the economicbenefits of the South China Sea. they would preferthat China "teach" those nations a lesson. a population). wheneverChina's territorial is challenged.Therefore. Of course. They oppose a major military operation as the vehicle by which Beijing regains controlover the South China Sea region.June 13. South-WestMilitary-Industrial complex in the Complex: The military-industrial of military South-Westof China is one of the most importantconcentrations industries in China.theyprefer China to respond integrity in a forceful way.low-intensity operation. even this group would not want an all-outwar. Military conflict would probablybring them more contracts. They do not want to see the current path of reforminterruptedby international conflict.be mobiof territorial is a high priority integrity lized by an appeal to nationalism. They could accept a military showdown that fell shortof actual fighting. However.limited militaryaction in which the military divisions from the Guangdong MilitaryRegion would be responsible forthe operation. iftheircontract(s)withChina were challenged by othernationsin the region.they probably arms preferto "teach" smaller countries a lesson with a limited. General Population 4: This group includes those whose positionon the issue is betweenGP2 (General Population 2) and GP3 (about 50-55% of the population). Included in this group are those who have not yet benefitedmuch fromecointegrity nomic reformsand who thereforeput heavier weight on territorial than on stability for the sake of economic reformand development. Neither for the sake of economic reformsnor military stability operations for the sake forthem. nor do theywant to see conservatives regain power. Recently. in China (about General Population 1: This group includes fanaticnationalists sensitiveto any foreignchallenge to 1% of the population) who are extremely China's territorial integrity. excluding Guangdong). the for theiroperation. American Oil Company(ies): This group includes the oil companies that are interestedin cooperating with China to explore oil in the area. G. they do not adamantly oppose a controlled.say. Many important military modernizationprojectshave been contractedto institutions in this region.

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