-1Comparative Kantian Peace Theory
Economic Interdependence and International Conflict at A Group Level of Analysis
Min Ye
yemin86@yahoo.com
Department of Government and International Studies
University of South Carolina
-2ABSTRACT
Liberal scholars in the international relations discipline argue that peace among nations would be
the consequence of three complementary influences. First, republican constitutions eliminate autocratic
caprice in waging war. Second, “an understanding of the legitimate rights of all citizens and of all
republics comes into play” with the spread of democracy. This creates a moral foundation for the
liberal peace, upon which eventually an edifice of international law can be built. Lastly, economic
interdependence reinforces constitutional constraints and liberal norms by creating transnational ties
that encourage accommodation rather than conflict. Thus material incentives add their force to law and
morality.
This paper is an analysis of how change in the level of economic interdependence in a subsystem
influences international conflicts within it. The research comparatively analyzes empirical data from
two subsystems, OECD and ASEAN. This research is distinctive in that (1) it simultaneously examines
the Kantian peace theory’s three “legs”, democracy, inter-governmental organizations and free trade,
(2) it provides an aggregated, group-level analysis of economic interdependence, and (3) it
differentiates international conflicts between lower intensity conflict and militarized interstate disputes.
Results from the statistical analysis indicate that in the OECD, an increase in economic
interdependence significantly reduces the incidence of lower intensity conflict, while an increase of
economic interdependence in ASEAN increases the occurrence of intra-ASEAN militarized disputes.
The results suggest that Kantian peace theory is context contingent and there is a "causal complexity"
in the economic interdependence-international conflict relationship. In addition, this research found
that a rivalry context was dominant in both OECD and ASEAN, and that a large proportion of
militarized disputes were fought over territory issues. Hence, rivalry theory and territory perspective
are more applicable than Kantian peace theory to the explanation of militarized international conflicts.
-3Liberals believed that democracy and trade would reduce the incidence of war. According to
liberals, wars were the result of international misunderstanding and domination of society by the
warrior class. Both factors could be reduced by commerce: trade brought individuals of different
nations into contact with one another and created common interests; and it increased the prosperity and
political power of the peaceful productive members of society at the expense of the aristocracy (Domke
1988, 43-51; Howard 1978).
Immanuel Kant largely developed modern liberalism. In his treatises on perpetual peace (1991
[1795]), Kant refined the liberal argument by suggesting that peace among democratic nations would
be the consequence of three complementary influences. First, republican constitutions eliminate
autocratic caprice in waging war. Second, an understanding of the legitimate rights of all citizens and
of all republics comes into play with the spread of democracy (Doyle 1986, 1161), resulting in the
creation of a moral foundation for the liberal peace upon which eventually an edifice of international
law can be built. Lastly, economic interdependence reinforces constitutional constraints and liberal
norms by creating transnational ties that encourage accommodation rather than conflict. Thus material
incentives add their force to law and morality.
Democracy’s impact on international conflict has received much attention. Democratic peace theory
has been rated as one of the “four largest accomplishments” in modern international relations theories
(Moore 1995).1 In keeping with the Kantian perspective, Russett and Oneal (1997) expand their
analysis beyond the democratic peace by incorporating the influence of economically important trade
and joint memberships in international organizations. They conclude that democracy, economic
interdependence, and international organization have strong and statistically significant effects on
reducing the probability that states will be involved in militarized disputes.
1
The other accomplishments are the initiation of scientific work by Quincy Wright, the insight
attributed to Kenneth Waltz (1959) that levels of analysis mattered, and the Correlates of War (COW)
Project that brought to fruition Wright’s efforts at creating an empirical database for the field.
-4However, generally speaking, political scientists have shown less interest in the consequences of
free trade and economic interdependence. Even in the late 1990s, scholars2 who attempted to test the
effects of economic interdependence were doing the research as a complementary examination of
democratic peace theory. In particular, when the studies involve the relationship among non-democratic
countries, the effect of economic interdependence appears difficult to determine (Gasiorowski 1986;
Domke 1988); there is little literature that has been devoted to investigation of the impact of economic
interdependence on non-democratic countries’ bilateral and multilateral relations.
Different from the extant research of economic interdependence at a dyadic or monadic level of
analysis, this paper focuses on a group-level trade-conflict relationship. This paper posits that the
group-level effects of economic interdependence are not equal to a simple summation of dyadic or
monadic impact. Instead, trading countries in a group are influenced by a “network effect” of trade
relationships in this group, i.e., a country’s decision to engage in conflict or cooperation toward the
other country is not only affected by their bilateral trade but also its trading with the third parties in the
group. A group-level analysis of trade-conflict relationship is indispensable to understand international
politics, especially in today's globalized world scenario.
This research paper examines the peaceful effect of economic interdependence and how it fits in the
broader Kantian model, using two international groups of countries, the Organization of Economic
Cooperation and Development (OECD) and the Association of Southeastern Asian Nations (ASEAN).
Countries in OECD are mostly well-established industrialized democracies while the ASEAN is largely
nondemocratic and is characterized by growth in transnational trade.3 As the world is roughly divided
into democratic and nondemocratic countries, and many international relations theorists argue that
democratic states behave differently from their nondemocratic counterparts, a comparative examination
of OECD and ASEAN allows for a better understanding of the impact of transnational trade on
international politics.
2
For representative contributions, see Oneal and Ray 1997; Russett and Oneal 1999a; Russett and
Oneal 1999b; Russett, Davis, and Oneal1998; Russett, Oneal, Oneal, and Maoz 1996.
-5This paper tests and refines the theoretical understanding of the liberal assertion of Kantian peace
theory. Its empirical findings provide information regarding the group-level impact of trade and add to
the research on conflict and cooperation. By examining the trade-conflict relationship in OECD and
ASEAN comparatively, we can have a better prediction of the political implications of the rapidly
growing international trade among parts of world in these decades, especially in Asia, South America,
and Africa. In particular, the results add insights into the evaluation of the increasing regional
economic integration and its impact on regional stability.
LITERATURE REVIEW
Although research advances have been limited, the effects of economic interdependence on
international politics have been studied decades. Theoretically, these studies can be divided into three
categories according to their different arguments regarding trade functionality in international relations.
The first category, from an “interest groups” perspective, argues that trade has a pacifying effect. Ruth
Arad and Seev Hirsch (1981) observe that trade can enhance peace between former belligerents by
capturing the impact of trade on the states' welfare with respect to consumers, producers, exporters and
importers. Solomon Polachek (1992, 1997), Polachek and McDonald (1992) note that trade and
investment serve as media for communicating interests, preferences, and needs on a broad range of
matters among trading partners. However, this perspective fails to account for conflict over the division
of costs and of gains, assumption of new risks, and relation of new vested interests. Thus the effect of
these vested interests on domestic support for peace is indeterminate unless the government
compensates the losers in economic transactions.
The second category focuses on the overall social welfare gains from trade (Polachek 1980, 60-62
and 1992). According to this model, each trading nation gains social welfare benefits and therefore has
a strong interest in maintaining peaceful relations. Polachek (1980) has argued that the greater the
welfare loss, the greater the costs of conflict, and thus the smaller the incentive for conflict. However,
3
For the regime type, see regime score of Polity III, Jaggers and Gurr 1995.
-6this national-gains perspective fails to account for some anomalies in world politics caused by the
sensitivity and vulnerability of interdependence (Keohane and Nye 1989).
The above two categories of trade-conflict theories, from different perspectives, both argue that
economic interdependence results in a more peaceful world. A third category finds this trade-reducesconflict model less convincing. These scholars argue that the ability of trade to promote peace is
contingent on the nature and context of economic linkages. 4 Dale Copeland (1996) refined trade
interdependence theory by controlling for trade expectations. He argues that a state’s expectation of
future trade is a crucial determinant of the state’s decision to maintain peace or to wage war. Polachek
and McDonald (1992) add another important variable to the trade-peace relationship: trade elasticity.
They argue that trade alone does not determine the gains derived from it. Trade data must be
augmented by country import demand and export supply elasticity. From a logic of game theory, James
Morrow (1999) notes that the net effect of trade on conflict is indeterminate. He observes that the
“initiator is less willing to fight, reducing the chance that it initiates a dispute, while at the same time,
the target is also less willing to fight, increasing the chance that it makes concessions to the initiator to
avoid war, and thus increasing the chance that the initiator begins a dispute” (Morrow 1999, 481).
On the other hand, empirical research of the trade-conflict relationship produced diverse findings.
First, some researchers find that trade is negatively related to international conflict. Economic
interdependence has an unconditional pacifying effect on international relations.5 Other findings are
totally opposite. Russett (1967) analyzes 41 warring dyads from 1946 to 1965 and found that trade
contributes to war occurrence. In recent years, Katherine Barbieri (1995, 1996a, 1997) concludes that
interdependence is positively related to the militarized interstate disputes from 1870 to 1985. Other
scholars found that the trade-conflict relationship is either mixed or negligible (Gasiorowski 1986,
Domke 1988).
4
For a detailed discussion, see Barbieri 1996b.
See discussions in Polachek 1980, Gasiorowski and Polachek 1982, Polachek and McDonald 1992,
Polachek 1992, 1997, Oneal and Ray 1997, Russett and Oneal 1997, and Russett and Oneal 1999a,
1999b.
5
-7Most of the studies have been done at a dyadic level of analysis; less scholarly attention has been
given to the systemic-level impact of economic interdependence: How does an increase of transnational
trade in a system affect the stability of the system? With an identified dyadic effect, some scholars
tackle the systemic effect by summing up the monadic effect or dyadic effect (Gleditsch and Hegre
1997). But the trade-conflict relationship in a system is more of a causal and empirical relationship than
a mathematical one. “We cannot understand systems by summing up the characteristics of the parts or
the bilateral relations between pairs of them” Jervis (1997, 34).
RESEARCH DESCRIPTION
This research is designed for a systematic and comparative study of the effects of economic
interdependence. A statistical method will be used to address the trade-conflict relationship in OECD
and ASEAN. Although both groups are highly interdependent, OECD contrasts with ASEAN in that
(1) it consists primarily of well-established democracies within a “security community”; (2) there is an
apparent hegemonic structure with United States’ preponderance. Empirical studies have concluded
that both a “security community” and a hegemon reduce the possibility of wars. Hence, a comparative
study of the two groups offers a better understanding of trade’s impact on conflict. In this paper, the
concept of international conflict is differentiated between lower intensity conflict and militarized
disputes as “Kant’s normative arguments apply to lower-level conflicts as well, since prohibitive norms
are expected to form a security community that ultimately rules out violence of any sort” (Cederman
2001, 19). This research uses a one-year lag to examine the causal relationship between economic
interdependence and international conflict: the value of incidence of conflict is recorded in one given
year, and the value of economic interdependence is recorded in the previous year.6
Key Variables:
1.
Lower intensity conflicts (LIC)—dependent variable (Y1). As the size of ASEAN is
different from OECD, I use the number of lower intensity conflicts divided by the size of the group to
6
According to John Stuart Mill (1967 [1843]), causality test should be done with three conditions: (1)
time sequence, (2) correlations, and (3) control variables.
-8measure the variable LIC. This variable is transformed from the PANDA database’s collection of
conflict events.7 PANDA data categorize international direct political actions into six “domains.”
Domain 1 and 2 refer to conflict events that resulted in some physical violent confrontation.
2.
Militarized interstate disputes (MID)—dependent variable (Y2). This variable is an
expression of the number of states involved in intra-group militarized disputes divided by the total
member states. I use Maoz’s dyadic Interstate Disputes dataset to measure MID.
3.
Economic interdependence level (EIL)—major independent variable (X1). The variable is
measured by total intra-group trade divided by summed GDP of the members: Economic
Interdependence Level = Total Intra-Trade / Total GDP. The trade data for OECD is imported directly
from Katherine Barbieri’s trade dataset. For ASEAN, Statistics of Trade is the source for data. Gross
domestic product data come from Penn World Table 5.6.8
4.
Regime type (REG)—control variable (D). This control is used, as OECD is democratic
while the members in ASEAN are non-democratic. In examining the economic interdependence to
lower intensity conflicts and economic interdependence to militarized interstate disputes relationships,
the regime is added as a control variable. The ASEAN data is coded as “0” and the OECD is coded as
“1.”
Hypothesized models:
This research project proposes two regression equations to model the two group-level effects:
LICt = b0 + b1 EILt-1 + b2REGt + e
(Equation 1)
MIDt = b0 + b1 EILt-1 + b2REGt + e
(Equation 2)
In equation 1, LIC measures lower intensity conflicts in OECD and ASEAN from 1984 to 1992. EIL
is the level of economic interdependence of OECD and ASEAN from 1983-1991. REG is a dummy
variable to measure regime type. ASEAN is “0” and OECD is “1.” In equation 2, MID measures intra7
Data are available at the web site: http://garnet.acns.fsu.edu/~phensel/intlconf.html#event
For complementary datasets, see Katherine Barbieri’s International Trade Data at
http://garnet.acns.fsu.edu/~phensel/intldata.html. International Monetary Fund. Direction of Trade
8
-9group militarized dispute in OECD (1961-1992) and ASEAN (1967-1992).
EIL is the level of
economic interdependence of OECD (1960-1991) and ASEAN (1966-1991). REG is the same.
To have a better understanding of the regime’s impact on the trade-conflict relationship, each of the
two multiple regressions are split into two models, one for OECD and the other for ASEAN. As a
result, four bivariate regression equations are created:
OECD_LICt = b0 + b1OECD_EILt-1 + e
(Equation 1.1)
ASEAN_LICt = b0 + b1ASEAN_EILt-1 + e
(Equation 1.2)
OECD_MIDt = b0 + b1 OECD_EILt-1 +e
(Equation 2.1)
ASEAN_MIDt = b0 + b1 ASEAN_EILt-1 + e
(Equation 2.1)
By splitting the two multiple regressions into four bivariate regressions based on regime type, this
study is able to specify the different regression coefficients and significance levels of these models.
STATISTICAL ANALYSIS
Lower Intensity Conflict (LIC) and Economic Interdependence level (EIL)
First, I ran a correlation test of LIC and EIL with merged OECD and ASEAN data. The partial
correlation test of LIC and EIL with a control for REG produces a negative and statistically significant
relationship between LIC and EIL (-.56 see Table 1). Then I test EIL-LIC correlation for ASEAN. The
result shows LIC in ASEAN is negatively related to its EIL but the correlation is not significant (Table
1). Correlation test of OECD demonstrates that the occurrence of LIC among OECD members is
negatively correlated with its EIL (-.667), and this correlation is significant (see Table 1).
(ICPSR 7623). Robert Summers, Alan Heston, Daniel Nuxoll, and Betlina Aten. The Penn World
Trade (Mark 5.6a). Cambridge, MA: National Bureau of Economic Research, 1995.
- 10 Table 1. Lower Intensity Conflicts divided by the size of the groups (LIC: 1984-1992) and Economic
Interdependence Level (EIL: 1983-1991): Correlation Analysis for the OECD, ASEAN, and pooled data.9
LIC
OECD_LIC
ASEAN_LIC
-.561 (.019)*(1)
EIL
OECD_EIL
-.667 (.050)*
ASEAN_EIL
-.267 (.488)
(1) LIC-TO-EIL correlation controls for regime. The “regime” variable is dummy variable: democratic group of countries is
coded as “1”, and the nondemocratic group of countries is coded as “0”.
(2) * represents statistically significant correlation at 0.05 level (two-tailed test).
(3) Values in the parentheses are the α level from the two-tailed tests.
Model Specification and Analysis
My next step is to model the three linear regression tests between economic interdependence and
lower intensity conflict (see Table 2). First, the regression test of ASEAN shows that the incidence of
LIC in ASEAN is negatively related to EIL of ASEAN after taking away the effect of size. But the
relationship is not significant, and R2 is not good either. In another words, the increase and decrease of
economic interdependence level in ASEAN group is not a predictor of the intra-ASEAN LIC.
ASEAN_LICt = 6.518 + (-1.058) ASEAN_EIL t-1 + e
(Equation 1.2)
Second, the regression test of LIC – EIL in OECD sheds valuable information (Equation 1.1). From
the output, R2 is .445, which means 44.5% of the variance of the OECD lower intensity conflicts (19841992) can be explained by the change of the economic interdependence level (EIL) in this group. This
model predicts that one percent increase of economic interdependence level can reduce 0.93 lower
intensity conflicts for every state, in another words, the total LIC will reduce by over 20 events in
OECD. This model is statistically significant.
OECD_LICt = 6.313 + (-0.93) OECD_EILt-1 + e
(Equation 1.1)
Third, regression test of pooled data of OECD and ASEAN sheds information of general LIC – EIL
relationship with a control for regime type.
LICt = 2.463 + (-0.668) EILt-1 + (1.22) REGt + e
9
(Equation 1)
Table 1, 2, 3, 4 are modified from the statistical analysis output with the SPSS program.
- 11 The R2 is as high as .563, which means 56.3% variance of lower intensity conflicts (LIC) can be
explained by this model. The REG is positively related with incidence of lower intensity conflicts,
which means, the OECD states are more likely to get into intra-OECD conflict than ASEAN states on
average. This can be expected, because in the OECD there is a high level of competing interests.
However, within the OECD, the increase of economic interdependence reduces lower intensity
conflicts.
Table 2. Economic interdependence level (EDL)’s effect on Lower Intensity Conflict (LIC) with a control of
regime type: Regression Model Specifications for the OECD, the ASEAN, and the pooled data: 1984-1992.
LIC
LICOECD
LICASEAN
R2 of the Model
.563 (.002)*
.445 (.050)*
.072 (.488)
# of Observations
18
9
9
Constant Variable
2.463 (.005)*
6.313 (.013)*
EIL
-.668 (.019)
Regime
*
-.93 (.050)
*
6.518 (.159)
-1.058 (.488)
*
1.22 (.001)
1)* represents statistical significance of the regression model and variables.
2) Values in parentheses refer to α level of two-tailed test. .05 represents significant relationship.
Militarized Interstate Dispute (MID) and Economic Interdependence Level (EIL)
Next a correlation analysis of economic interdependence and militarized interstate disputes is
carried out. For pooled OECD and ASEAN data, the result demonstrates that economic
interdependence is positively related to intra-group militarized disputes (see Table 3). For the OECD,
the correlation of MID-EIL is slight and not significant. The R2 and regression coefficients from
statistical analysis show that there is no linear relationship between these two variables.
Table 3. Militarized Interstate Disputes divided by the size of the groups (MID) and Economic
Interdependence Level (EIL): Correlation Analysis for the OECD, the ASEAN, and the pooled data: 19621992 for OECD and 1967 to 1992 for ASEAN.
MID
EIL
.19 (.16)
OECD_MID
OECD_EIL
ASEAN_EIL
(1)
(2)
ASEAN_MID
(1)
The MID-to-EIL correlation control for regime.
* refers to statistical significance.
.012 (.949)
.395 (.048)*
- 12 In ASEAN, there is a positive and significant relationship between EIL and MID. The regression
model (Equation 2.2) illustrates that 15% variance of the number of member states involved in intraASEAN militarized disputes can be explained by the variance of the economic interdependence level of
ASEAN with one-year lag. Economic interdependence produces intra-group militarized disputes.
ASEAN_MIDt = -0.05 + 0.392 ASEAN_EILt-1 + e
(Equation 2.2)
Third, multiple regression analysis of MID – EIL with control of regime can be specified as follows:
MIDt = 0.12 + (0.024) EILt-1 + (-0.126) REGt + e
(Equation 2)
Looking at Table 4, the results show that EIL is positively related to MID with a control for regime.
The R2 shows that the model is a good fit for the data (.113), and the model is statistically significant.
Although the effect of EIL is not very significant, the REG has a statistically significant negative effect
on MID. This means that for an average democratic state, the chance of getting into intra-group MID is
lower than its nondemocratic counterparts.
Table 4. Economic Interdependence Level (EIL)’s effect on the number of countries involved in Militarized
Interstate Disputes (MID/size) with a control of regime type: Regression Model Specifications for OECD
(1962-1992), ASEAN (1967-1992) and the pooled data.
R2
(1)
OECD
ASEAN
Pooled Data
N**
Constant
EIL
Regime
31
.15 (.048)*
.113 (.039)*
26
57
-.05 (.923)
.392 (.048)*
*
.127 (.011)
.024 (.16)
-.126 (.017)*
2
(1) The R , regression coefficients are negligible for the OECDEIL-to-OECDMID/SIZE model.
(2) * represents statistical significance of the variable.
(3) ** represents the number of observations in this regression model.
(4) Values in parentheses are α values.
INTERPRETATION AND REPORT
This paper details a test of the Kantian peace theory by using two IGOs, OECD and ASEAN. The
data analysis and statistical analysis at a group level demonstrate that economic interdependence is
negatively related to lower intensity conflicts but this effect is statistically insignificant in
nondemocratic ASEAN and that economic interdependence is positively related to militarized interstate
disputes, but this relationship is negligible in the democratic OECD. In addition, regime (REG) is
negatively related with MID. This test raises questions like why the trade-conflict relationship varies
- 13 across different groups and different types of conflict and what alternative explanations might address
these phenomena.
Regarding the question of why an increase in the economic interdependence level in OECD has
reduced the incidence of the lower intensity conflicts (LICs) significantly, while in the ASEAN group
this pattern is not significant. The first possibility is their differed international behavioral patterns. The
OECD countries have stable, developed, and long-standing bureaucratic systems. Their international
participation is systematic, predictable, and transparent. In contrast, the ASEAN countries mostly
became modern states after the World War II, and their bureaucratic systems have yet to develop; their
political action is not so systematic as to be nicely accounted in event data, which is based on news
network, Reuter’s.
Secondly, although both groups of countries are increasingly bound by economic interdependence
and inter-governmental organizations, as noted, the OECD countries are primarily democracies while
the ASEAN members are not democratic. This difference in domestic system is also closely related to
the difference in their practice of international relations. But to answer these questions as why the
economic interdependence level has reduced the incidence of lower intensity conflicts in the group of
democracies but failed to do the same in countries that are not democratic, and why economic
interdependence has positively influenced the intra-group militarized disputes, we must revisit the
Kantian peace theory.
Kantian Peace Theory Revisited
After more than a decade of intense scholarly debate, Kantian theory is well supported but the
debate over its explanation remains. Despite their fundamental disagreement, both realists and liberals
“agree that Immanuel Kant laid the intellectual foundation” of the democratic peace theory (Cederman
2001, 15). However, whether aiming at corroboration or refutation, most contemporary scholars appear
to test some version of the Kantian thesis. Some analysts have come closer to Kant’s original
conjecture by embracing more of its analytical dimensions, but neither side of the debate is fully
- 14 capturing the dynamic and dialectical logic of the process. "Partial representations are responsible for
many of the empirical and theoretical disputes haunting the current debate (Cederman 2001, 15)."
According to Oneal and Russett’s interpretation (1997, 268), the Kantian peace conjecture consists
of three “legs”—the democratic political system, the international legal system, and free trade. The
three factors “are highly interconnected” (Cederman 2001, 16). The existence of a democratic regime is
a precondition for other factors to have a pacifying effect on international relations. Economic
interdependence alone cannot reduce international conflicts or build an international legal system.
Instead, it reinforces the pacifying tendency of democracies toward democracies and helps to facilitate
integration among democracies.
Contacts and communications brought about by trade relationships do not necessarily lead to
peaceful interstate relations. According to Jeffrey Rubin, Dean Pruitt, and Sung Hee Kim (1993, 20),
“conflict is especially likely to be produced when group members are in close proximity to one another,
are involved in common activities, and/or have access to the technology of communication.” This
tendency is intensified by the nondemocratic political system dominated by zero-sum thinking. Without
peaceful conflict resolution mechanisms, unbalanced trade relationships serve as a trigger of conflict.
This is one possible reason why in ASEAN, a development of intra-group trade appears to cause
militarized disputes. For these member states, Indonesia, Malaysia, Philippine, Singapore, Thailand,
and Brunei (joined in 1984), interest incompatibility over trade issues sometimes easily escalated to
militarized disputes.
The analyses presented here demonstrate the “causal complexity” of Kantian peace theory.
According to Ragin, the key feature of causal complexity is “the conjunctural or combinatorial nature,”
which means “the right ingredients for change” (Ragin 1987, 25). For the trade-conflict negative
relationship to hold, the context is crucial. In group-level international relations, an increase of
economic interdependence within a group has a significant pacifying effect on its members’ bilateral
and multilateral relations when most of the members are democracies. The comparative analysis and
the results in this research explain why various empirical studies of economic interdependence have led
- 15 to diverse and contradictory conclusions. Without accounting for "context contingency" and “causal
complexity” in trade-conflict relationship, debates over the direction and significance of economic
interdependence’s impact on international relations are incomplete and warrant further specifications.
Alternative Explanations
From the above observations, we see how the trade-conflict relationship in OECD differs from that
in ASEAN in its explanatory capability and significance level. This discrepancy can only be partially
explained through a thorough examination of Kantian theory. Kantian theory does not explain why
economic interdependence has been positively related to militarized disputes, although in OECD the
relationship is not statistically significant. The reasons are two. First, most of the militarized disputes
involve the same pairs of states in the group. Second, most of the militarized disputes involve territorial
or religious conflict, which cannot be explained by simple economic interdependence. To explain the
incidence of intra-group militarized disputes, alternative conflict theories and models are called upon in
the following section.
Rivalry. Although the number of countries involved in intra-group militarized disputes (MIDs)
varies in OECD from 1962 to 1992, and in ASEAN from 1967 to 1992, the participants in these
militarized disputes are primarily from the same pairs of states over these years. From 1962 to 1992,
there are total 23 militarized disputes in OECD, 13 of which occurred between Greece and Turkey
(1963 to 1989). Three of them happened between Canada and USA. Two of them occurred between the
United Kingdom and the Iceland (1972 and 1975). And two of them were between Denmark and
Norway (see Table 5). The recurring militarized interstate disputes define these parties as rivals and
some of them are enduring rivals.10 For example, Goertz and Diehl define Greece and Turkey as
enduring rivals with at least six militarized disputes that last across over twenty years. The other pairs
10
According to Frank Wayman (2000), enduring rivalry has to meet the three conditions: (1) severity,
there must exist at least five reciprocated militarized disputes between the parties and each MID lasts
at least thirty days; (2) durability, there must be at least twenty-five years between the outbreak of the
first dispute and the termination of the last dispute; and (3) continuity, the gap between any two
militarized disputes doesn’t exceed ten year (Wayman 2000, 229).
- 16 like the United Kingdom and Iceland, Denmark and Norway, and USA and Canada are isolated rivals
who are in one- and two-dispute rivalries for an isolated period of years (Goertz and Diehl 2000, 216).
Table 5. Intra-OECD Militarized Disputes and Rivalry Analysis: 1962-1992.
Enduring rivalry: Greece against Turkey
Total MIDs
23 militarized disputes (100%)
13 (56.5%)
Discrete rivalry: USA against Canada
Iceland against Britain
Denmark against Norway
Spain against Britain
10 (43.5%)
Non-rivalry: Ireland against Spain
1 (4%)
In ASEAN from 1967 to 1992, there are a total of 11 militarized disputes. Ten of them happened
between Malaysia and Philippine (1968-1985) (see Table 6). The enduring rivalry between Malaysia
and Philippine can be used to explain why the Kantian peace does not hold. That is, the test for Kantian
peace theory is undermined without controlling for the apparent rivalry context of the two groups.
Table 6. Intra-ASEAN Militarized Disputes and Rivalry Analysis: 1967-1992.
Total MID:
11 (100%)
Enduring rivalry: Malaysia against Philippines
10 (90.9%)
Non-rivalry: Singapore against Philippines
1 (9.1%)
Rivalry theory, in contrast to traditional international conflict literature, “presumes that conflicts are
not independent but are actually related to each other over time and space. This suggests that conflict is
a function of the dynamics and interactions of the protagonists’ rivalry relationship” (Goertz and Diehl
2000, 197). Goertz and Diehl observe that there is a general interrelationship of conflict events brought
about by the rivalry context and a series of results indicate that rivalry context has a significant impact
on conflict behavior. As a result, “the recurrent disputes and rivalry play a role in explaining the onset
of war” (Wayman 2000, 233).
On the other hand, the “democratic peace” has also been the subject of rivalry analysis. George
Modelski (1999) claims that democratic rivalries are more peaceful and more likely to be resolved “on
their merits” rather than by military force. Williams Thompson (1999) cites mutual democracy as a
- 17 pacifying condition in the Anglo-American rivalry. According to Hensel (1996), the presence of a
democratic dyad generally has a dampening effect on conflict recurrence in the rivalry. This theory is
supported with the results from this comparative study of OECD and ASEAN.
Territory and Religious Perspectives. To see why the hypothesized pacifying effects of economic
interdependence haven’t been supported in the analysis of militarized disputes at a group level, we must
examine what these militarized disputes were about. Although the full account of each militarized
dispute is not available, from Maoz’s MIDC-210 data file, we can identify roughly what these
participants were fighting about. In OECD, most of militarized disputes were over territory and religion
(see Table 7). In ASEAN, fighting over territory and religion has also occurred. In some cases, territory
disputes are intertwined with religious disputes. For example, Thailand and Malaysia have fought over
religion and territory for over 10 years (see Table 8).
Table 7: Intra-OECD Militarized Disputes (1962-1992): what they were fighting for?
Period
1961
1969
1974
1974
Parties
UK against Denmark
UK against Spain
Greece vs. Turkey
Turkey, Cyprus, and Greece
Title
Seizure of the red Crusader
Gibraltar
Aegean Sea oil exploration
Cyprus War
1975
Greece and Turkey
Cyprus negotiations
1976
1976
UK and Iceland
Greece and Turkey
Cod War II
Aegean Sea dispute
*UHHFHDQG7XUNH\
$HJHDQ6HD
1982
Greece and Turkey
Aegean Sea
Table 8: Intra-ASEAN Militarized Disputes (1967-1992): what they were fighting for?
Period
Parties
Title
1980
Philippine and Malaysia
Sabah dispute
1980
Malaysia and Thailand
Burma/Thailand
1982-83
Thailand and Malaysia
Burma/Thailand fishing boats
1984
Thailand and Malaysia
Burma/Thailand clashes
1988
Philippine and Malaysia
Spratly Islands dispute VI
- 18 A large section of the conflict literature focuses on geography as “a context or source of conflict.”
The territory perspective suggests that geography is important primarily because states will fight over
territorial issues (Hensel 2000, 57). Although many types of issues may be salient enough to lead to
war, the territorial perspective suggests that territorial issues are especially salient and especially likely
to lead to conflict and war (Vasquez 1993, 1995, 1996; Hensel 1996). Scholars have argued that
territory is “conspicuous among the causes of war” (Hill 1945, 3), “perhaps the most important single
cause of war between states in the last two or three centuries” (Luard 1970, 7), or “the source of
conflict most likely to end in war” (Vasquez 1993, 124).
Territory is often seen as highly important for three reasons: its tangible contents or attributes, its
intangible or psychological value, and its effects on a state’s reputation (Hensel 2000, 58). Territory
thus appears to be seen by leaders as very important, justifying the risks of escalation to protect or
advance one’s interests much more than other types of issues. Hensel (1996) observes that when
territorial issues are at stake, nearly three-fourths of all disputes are followed quickly by another
dispute, and the statistical odds of a recurrent dispute are nearly twice as great for disputes involving
territorial issues.
From the above discussion, it is clear that militarized interstate disputes at the group level are too
complex to be predicted with the single independent variable—economic interdependence. Instead,
both rivalry and territorial theories are more applicable. To reach a more complete understanding of
economic interdependence-international conflict relationship, we must combine it with realist concepts
and liberal democracy peace theories.
CONCLUSION
This paper conducts a new test of economic interdependence, incorporating a measure of regime
type with a control for common membership in an IGO. Analyses in this paper suggest that both
economic interdependence and democracy have a pacifying group-level effect. Compared to the extant
theory and research, this project has the following features:
- 19 (1)
It offers a simultaneous evaluation of the liberal’s political and economic prescriptions for
peace: democracy, inter-governmental organization, and free trade, while examining context
contingency and the “conjunctural causality” (Ragin 1987) of these factors in reducing conflicts;
(2)
It examines the sub-systemic effect of economic interdependence. Rather than the research
focusing on dyadic and monadic behavioral pattern of states, this paper proposes that a group-level
"network effect" of economic interdependence that cannot be caught by either dyadic or monadic
analyses. This study provides a broad picture of economic impact at an aggregate, sub-systemic level;
and
(3)
It
differentiates
international
conflict
and
separately
investigates
economic
interdependence’s impact on lower intensity conflicts and militarized interstate disputes. As the
transnational militarized disputes and wars become less frequent in today’s world, especially in the
OECD case, lower intensity conflict analysis is more relevant.
In terms of the questions raised in this paper, the following conclusions can be stated:
(1)
Does trade affect conflict? The general answer to this question is “Yes.” From the
empirical studies in this paper, an increase of economic interdependence precedes a decrease of lower
intensity conflicts in OECD. In ASEAN, an increase of economic interdependence is related to an
increase of intra-group militarized disputes. The data indicates that an increase in economic
interdependence also reduces lower intensity conflicts in ASEAN and increases intra-OECD
militarized disputes, but the two relationships are not statistically significant.
(2)
Can a pattern be documented? The statistical analysis in this paper demonstrates that
economic interdependence is related to international conflict, but this relationship is more complex than
a single trade-conflict model can capture. Only with combined explanation based on liberal essence and
realist perspectives, taking into account of causal complexity, can a coherent pattern be drawn to
address the discrepancies, inconsistencies, and nuanced trade-conflict relationship.
(3)
Are there alternative explanations in the literature? The major source of the confusion
regarding the relationship between economic interdependence and conflict is the multiplicity of
- 20 explanations. As we noted, rivalry theory, territorial perspective, and religious conflict literature all
shed light on the complex situations.
(4)
Do conflict differentiation and group differentiation matter? This paper differentiates
conflict between lower intensity conflict and militarized disputes. The results support my hypothesis
that different types of conflict hold different relationship with economic interdependence. A
comparative analysis of OECD and ASEAN indicates a different relationship between economic
interdependence and international conflict in the two groups. As a result, it appears that differentiation
of groups based on domestic political system is of significance.
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