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Steel Hulls and High-Stakes: Prospect Theory and China’s Use of Military Force in the South China Sea

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Abstract

Scholarship on China’s behavior in the South China Sea has raised questions about peace prospects between China and its regional neighbors in Southeast Asia. This chapter develops a bargaining power-prospect theory model to explain China’s behavior in the South China Sea during the Cold War. The model hypothesizes Chinese behavior is attributable to variation in two main factors: China’s relationship with great powers and leaders’ perceptions of China’s bargaining power vis-à-vis its competitors. I provide narratives of the 1960 establishment of People’s Liberation Army Navy regular patrols to the Paracels, the 1966 South Vietnam withdrawal from the Crescent Group, the 1974 Battle for the Paracels, and the 1988 Sino-Vietnamese encounter in the Spratlys as congruence tests for the model. Findings show that when Chinese leaders are situated in a domain of losses, use of force becomes more likely, and vice versa. The paper advances two goals. Theoretically, it provides a comprehensive way to capture the complex variations of China’s use of force in the disputes. The first two case studies focus on empirically understudied periods of the South China Sea disputes. The findings will hopefully be used by actors with a stake in the dispute to reduce the likelihood of future clashes.

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Notes

  1. 1.

    Even constructivist approaches tend to make assumptions about the rational pursuit of goals, however bounded they may be. For example, see domestic political institution arguments (Blanchard 1988; Huth 1996) and international institution arguments (Kocs 1995; Zacher 2001) on territorial disputes.

  2. 2.

    The primary concern here is to understand the basic characteristics of these functions and how they account for the human biases when making decisions between risky prospects. see Kahneman and Tversky (1979, pp. 277–284) for a detailed explanation of these functions’ mathematical properties.

  3. 3.

    This literature review is incomplete and informed by the necessities of the contribution itself. For in-depth reviews of prospect theory and its early applications to international relations see McDermott (2004); or Mercer (2005). The following is a list of prospect theory-related works in IR that were referenced in the writing of this chapter: Berejikian (1992, 1997, 2002, 2004), Boettcher (1995), Bueno de Mesquita et al. (2008), Camerer (2005), Farnham (1992), Haas (2001), Jervis (1992, 2004), Kühberger (1998), Levy (1992, 1996, 1997), Levi and Whyte (1997), Mandel (2001), McDermott (1992, 1998), McDermott et al. (2008), McDermott and Kugler (2001), McInerney (1992), Pauly (1993), Quattrone and Tversky (1988), Richardson (1993), Rieger (2014), Rothman (2011), Shafir (1992), Taliaferro (1994, 1998, 2004), Welch (1993a, b) and Weyland (1996, 1998).

  4. 4.

    Xinhua News Agency, May 17 1950.

  5. 5.

    Ministry of Foreign Affairs, “China’s Indisputable Sovereignty over the Xisha and Nansha Islands,” Peking Review, 18 February 1980.

  6. 6.

    People’s Daily, February 28, 1959, p. 4.

  7. 7.

    “Telegram 4011 to Saigon,” June 10, Department of State, Central Files, 790.022/6–1056.

  8. 8.

    Central Military Commission, “Instructions for the Paracel’s Amphitrite Group Naval Patrol,” March 13, 1959.

  9. 9.

    The front half of the small escort ship’s hull consisted of a Japanese ship which had been damaged during World War II and then repaired. After the war it was taken by Nationalist forces and was finally captured by the Communists. Prior to being refurbished and fitted with two 100-m cannons by the PLA Navy, the ship sat docked in Guangdong harbor for nearly 10 years. This is emblematic of the extremely limited resources the PLAN was operating with at the time.

  10. 10.

    New York Times, April 5 1961, p. 2.

  11. 11.

    New York Times, 10 June, 1971, 9.

  12. 12.

    Xinhua, 1 January 1986 (Lexis-Nexis); RMRB, 2 January 1986, 1.

  13. 13.

    People’s Daily, March 17, 1988.

  14. 14.

    dongsha, xisha, nansha qundao qingkuang jianjie ziliao [A Summary of the Situation in the Pratas, Paracels, and Spratlys Islands], guangzhou junqu silingbu erbu cang [Guangzhou Military Region Headquarters, Second Department].

  15. 15.

    O’Connor and Hardy (2015)

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  1. Department of Political Science, Oakland University, 2200 N. Squirrel Road, Rochester, MI, 48309, USA

    Evan Jones

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  1. Center for Global Studies, University of Bonn, Bonn, Germany

    Enrico Fels

  2. and Humanities, University of Social Sciences, Ho Chi Minh City, Vietnam

    Truong-Minh Vu

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Jones, E. (2016). Steel Hulls and High-Stakes: Prospect Theory and China’s Use of Military Force in the South China Sea. In: Fels, E., Vu, TM. (eds) Power Politics in Asia’s Contested Waters. Global Power Shift. Springer, Cham. https://doi.org/10.1007/978-3-319-26152-2_10

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