ALLIANCE AND ECONOMIC COHESION BETWEEN STATES: SOME INTERRELATIONSHIPS

This dissertation examines how changes in alliance cohesion between states interact over time with changes in economic cohesion between those same partners. The role of economic ties in cementing alliances or of security-alliance ties in affecting patterns of trade and investment has often been discussed, but rarely in a comprehensive or rigorous manner.;The interrelationships between changes in alliance and economic cohesion for a given pair of states are investigated theoretically, with appropriate examples, within a framework of four logical possibilities. They are first, that changes in economic cohesion generally precede and influence changes in alliance (security) cohesion--the economic/alliance case; second, that changes in alliance cohesion precede and influence economic cohesion--the alliance/economic case; third, that each influences the other in either an iterative or a simultaneous manner; and fourth, that changes in the two processes are unrelated.;First, the economic/alliance case has received the most support in the literature, especially from many of the students of integration and interdependence. Moreover, positive effects of economic on alliance ties are generally assumed. To assess this emphasis theoretically, an expected utility model of alliance cohesion decision making is constructed. The calculus incorporates the risk of conflict, national capabilities, and third party effects. Positive influences are found to be rational only in a limited number of cases of major power interactions. Contrary to the expectations of the literature, economic influences on alliance ties are found to be negative or at least indeterminate in cases involving minor powers. Moreover, limitations of the economic/alliance case remain evident when the assumptions of the calculus are relaxed to include a wider range of conditions.;The alliance/economic case has received less attention, but it is argued that alliance effects on economic ties are an important aspect of cohesion interrelationships. Depending upon stated alliance conditions, it may be advantageous to influence economic ties directly to minimize an enemy's capabilities; to distribute alliance capabilities optimally; or to provide side payments for encouraging collective alliance behavior. Alliance cohesion changes are found also to have significant indirect economic effects on the risk profiles of economic agents.;Alliance cohesion is defined as the willingness of one state to aid another when the other's sovereignty is threatened. It represents a continuum that ranges from the opposing security interests of enemies to positive security ties among allies. Economic cohesion is defined as the value of economic ties between partners, and thus represents the opportunity cost of economic interactions.;A third logical case applies when alliance and economic cohesion interact in an iterative or simultaneous manner. Cohesion influences may iterate between the two previous cases, and the likelihood for sustaining such iterations is explored. Simultaneous interactions (when alliance and economic changes occur at the same time) encompass an important set of cohesion relationships. They apply to a wide range of bargaining strategies between partners with alternative objectives and can account for anticipatory behavior.;The final logical case assumes that changes in economic and alliance cohesion are unrelated. Based on the previous analysis, some partial (marginal) connections are almost always expected. This does not preclude the likelihood of independent cohesion movement, however, given the stated requirements for substantial cohesion interrelationships and the differences between alliance and market motivations.