Interdependence

Question 1

Interdependence definition

Answer 1

Reciprocal effects among states resulting from cross-border flows of money, goods, people, and information

Question 2

Immediate consequences of interdependence

Answer 2

The well-being of a state and its citizens depends on decisions taken by actors in other countries

Question 3

What does interdependence vary on?

Answer 3

• Over time
• Across issue areas, higher in some than others
• Across regions and relationships, higher in some than others
• Within relationships, A may depend more on B than B depends on A

Question 4

Expectations of interdependence Keohane and Nye 1977 (international cooperation)

Answer 4

• Interdependence motivates international cooperation by:
  – Exposing states to a risk of external shocks
  – Creating opportunities for join gains
• States will create international institutions (rules and organizations) to reduce risk and maximize gains from interdependence

Question 5

Observations of interdependence post-1977 (international cooperation)

Answer 5

• Interdependence -> broad and deep institutionalization of world politics (within and across all regions and issue areas) -> more of cross-border integration of economies and societies
• Extensive international cooperation and support for rule-based international order
• Cross-border integration -> massive but uneven growth (both across and within societies)
• But continued global shocks to domestic well-being -> backlash against interdependence

Question 6

Expectations of interdependence Keohane and Nye 1977 (power of states)

Answer 6

• Power lies in the two states’ relative dependence on each other – i.e., the difference in the costs each would pay if cross-border flows were reduced or increased.
  – A relies more on B than B on A, we have to look at the relative dependence more
  – The one that is hurt more from the breaking of that relationship is the one more dependent
• The less-vulnerable state can (threaten to) manipulate cross-border flows if the more-vulnerable state doesn’t comply with its wishes.

Question 7

Observations of interdependence post-1977 (power of states)

Answer 7

• Massive expansion in use of “sanctions” as a tool of statecraft
• States try to shield themselves from sanctions, via:
  – Self-reliance in production
  – Diversification of supply
  – Accumulation of financial reserves

Question 8

2021 EU-Belarus (interdependence)

Answer 8

• EU reduces cross-border flows
  – Imposes financial sanctions to punish Belarus government for election fraud and political repression
• Belarus increases cross-border flows:
  – Facilitates passage of 3rd country migrants to punish EU for financial sanctions

Question 9

2022 EU-Russia, after invasion of Ukraine (interdependence)

Answer 9

• EU reduces cross-border flows
  – Cuts energy purchases, investment and technology to Russia
• Russia reduces cross-border flows
  – Reduces supplies of energy to EU

Question 10

The “New Interdependence”

Answer 10

We live in “the world that trade built”: Decades of pro-globalization policies have restructured the international system
- Rule overlap:
– Development of global rules creates clashes between national and global jurisdiction
- Transnational alliances:
– Institutionalization of globalization creates new opportunities for firms, citizens, NGOs to form transnational alliances and press for policy change
- Power asymmetries:
– Institutions are not just “rules of the game” - they’re a source of uneven, asymmetric power
– Some states have more influence over the institutions that govern interdependence

Question 11

Results of the “new interdependence”

Answer 11

The institutions of globalization are contested
- “The politics of globalization has expanded from struggles over free trade and protectionism to a much broader and complicated fight over the rules and principles that affect how the economic and political benefits of globalization are distributed”
Non-state actors play a critical role
- World politics is not “a world of discrete independent states [but] a world where both overlapping jurisdictions and the needs to resolve the problems and disputes that emerged from this overlap create new opportunity structures for actors beneath the level of the unitary nation-state”

Question 12

China’s contestation of the institutions that govern interdependence

Answer 12

Two strategies:
- Place personnel in leadership positions in existing (“legacy”) institutions
– Will senior personnel change the policy agenda of existing international institutions?
- Create new, alternative institutions, less controlled by US and EU
– Shanghai Cooperation Organization; Asian Infrastructure Investment Bank; New Development Bank
—> Will new institutions complement or compete with legacy institutions
—> Do new institutions have similar or different policy aims, compared to legacy institutions

Question 13

Weaponized Interdependence

Answer 13

Focus on structural aspect of interdependence
- In complex networks some actors are more centrally connected than others -> new and uneven opportunities for “weaponization”
- On power and coercion:
– Actors who occupy key positions within networks of interdependence can use these positions to gain power by gathering information on others (“panopticon effect”) and limiting their access to resources (“chokepoint effect”)
- On international institutions
– “Institutions designed to generate market efficiencies and reduce transaction costs can be deployed for coercive ends”

Question 14

Implications of weaponized interdependence

Answer 14

• Interdependence gives well-connected states a non-military source of power
• Interdependence may also be a source of vulnerability for traditional powers
• This gives all states an incentive to reduce their vulnerability via controls on information, increased financial reserves, and self-sufficiency for key resources (richer states better able to reduce their vulnerabilities)