CIAO DATE: 12/2014
November 2014
Borrowing insights from prospect theory, this paper introduces a “political survival-prospect” model to explain the dynamics of China’s foreign policy behaviour during crises. I argue that when Chinese leaders are framed in a domain of losses with respect to political survival, a risk-acceptant behaviour, e.g. coercive diplomacy, is more likely to be adopted. When Chinese leaders are framed in a domain of gains, a risk-averse behaviour, e.g. an accommodative policy, is more likely to be chosen. Two crises, the 2009 Impeccable incident between China and the United States and the 2010 boat collision crisis between China and Japan, are studied to test Chinese President Hu Jintao’s decision-making during crises.
Resource link: Prospect Theory and China's Crisis Behaviour Under Hu Jintao [PDF] - 504K