The Influence of an Internationalizing Coalition on Political Leaders: A Key Intermediate Variable in the Relationship between Trade Interdependence and International Conflict





Published date: 

June, 2015


Chien-wu Hsueh


The purpose of this article is to demonstrate that the influence of an
internationalizing coalition on political leaders is a key mediating variable
in the relationship between trade interdependence and international
conflict. In the literature, scholars have contradicting theories and empirical
conclusions about whether trade interdependence promotes peace or
conflict. In this article, I argue that, dyadically, the pacifying effect of trade
interdependence is conditional upon the influence of an internationalizing
coalition on both political leaders. When the support of internationalizing
coalitions is important to both leaders’ political survival, the leaders will be
more reluctant to use militarized measures to solve international disputes
because the use of force will compromise the internationalizing coalitions’
opportunity to make money. On the other hand, if the support from the
internationalizing coalitions is not important to both leaders’ political survival, the leaders will feel less constrained to use militarized measures.
The underlying assumption is that internationalizing coalitions always
prefer a peaceful and stable commercial environment to a conflictual one,
because a conflictual situation hurts their commercial interests. I use a
game-theoretical model to demonstrate the logic of this theory and then
test it with logit and generalized estimating equations (GEE) models
using data from 1962 to 2001. Besides, the game-theoretical model also
points to a phenomenon that is worth paying attention to: as the influence
of internationalizing coalitions on both political leaders increases, the
probability of a militarized interstate dispute decreases, but this does not
guarantee a positive peace-under some situations peace is built under the
disguise of successful coercions. Based on this finding, a policy implication
regarding the Cross-Strait relationship is suggested in the last part of this