Reglamento para el establecimiento, autorización y funcionamiento de

The motivating question for this chapter was: What role does direct prior experiences play in the success or failure of current sanction threats? From the quantitative findings reported above, one could conclude that the role of dyadic experience is limited indeed. Outcomes in the data appear to be unrelated to values of Dyadic Sender Reputation while the results of Chapter 4 clearly indicate that Monadic Sender Reputation has a large and positive impact on the chances for target concessions at the threat stage.

Such a finding suggests that monadic histories—not dyadic experiences—drive threat effectiveness, which is consistent with the notion that states tend to look beyond their own prior encounters with particular sanctioners. On the one hand, it is possible that targets do not in fact consider first-hand experience to be more relevant or reliable than other sources of information about the sender state. If this is the case, reputations truly are monadic and the findings presented in Chapter 4 describe more accurately the reality of historical inferences in economic coercion.

On the other hand, it is possible that targeted states rely on the totality of a sender’s past record simply because it is a more plentiful source of information. Third-party observations, combined with however few or many direct past encounters a current target might have had with the sender, provide a greater number of clues about the sender’s willingness and ability to sanction. As noted earlier, a relatively small group of sanctioners accounts for a large number of sanction threats in the data. These states are more active in economic coercion due to their superior their economic prowess, more diverse and expansive foreign interests, or because they are unable or unwilling to employ other coercive tools such as armed force. Major sanctioners may threaten sanctions against particular target states infrequently but

nonetheless accumulate a significant record because they threaten many different targets. As a consequence, each target may only have a small number of direct experiences to draw on compared to the wealth of information contained in the sender’s total history of imposing sanctions. When forced to form a judgment about a major sanctioner, it may be difficult if not irrational for any target to ignore this additional information. If more information is inherently preferable when trying to form a judgment about the sender, target policy makers might be inclined to rely heavily on the experiences of others in addition to their own.

Target states in the data simply may have had too few of these direct experiences with a given sender to influence credibility assessments and decisively steer their responses to sanction threats. This possibility, which cannot be ruled out using the data at hand, has important implications and raises additional questions about the general causal mechanism that future research should address. One of the most fundamental questions for any theory of reputation is: how much information and, more specifically, how many events or direct experiences are needed before a reputation crystallizes in the minds of observers? This project has proceeded from the assumption that reputations for resolve (or lack thereof) form with the first observation of a sender’s actions and can be modified by each subsequent observation. While I believe that this image represents a good first approximation of the underlying reality of reputation formation and evolution, it is also likely that the process is somewhat less linear than suggested here. For example, targets may require a certain minimum number of experiences before they have a firm grasp on a sender’s type. Similarly, once a sender has acquired a particular reputation through repeated interaction with target states, this reputation may become almost impervious to change in the minds of others and each subsequent observation will have a relatively small impact on the overall image of the

sanctioner. Sender behavior will affect its reputation more dramatically earlier in its history of sanctioning and alter it only marginally later on. Another way to think about this problem is how strong the factual basis of a reputation must be before a target is sufficiently confident in its assessment of the sender to stake its economic well-being on an educated guess. Most importantly, given the empirical result reported above, if it is true that the target states in the data analyzed here simply lacked sufficient direct experiences with the sender states, it may be premature to dismiss the dyadic reputation argument on the basis of a non-finding in this project.

The monadic sender reputation is an amalgamation of direct experience and third-party observation. Earlier the case was made that sanctioning behavior vis-à-vis third parties may be less informative to a current target state that differs in important aspects from prior targets; one’s own direct experience should arguably provide more relevant insights. Yet some third parties may resemble the current target to such an extent that third-party observations involving these similar states and the current sender again become useful. As a result, targeted states may draw conclusions from a sender’s past record of threat enforcement more selectively than the monadic reputation argument suggests, but more liberally than is implied in the dyadic version of the argument. Recent studies have evaluated the notion of extra-dyadic learning in the context of militarized conflict (Crescenzi 2007; Crescenzi, Kathman and Long 2007). The application of this concept to the process of economic coercion is a promising area for future research. A first challenge will be to identify those characteristics of other states that targets may perceive as ‘relevant’ to reputational inferences.

Chapter 6