Exploring China's Audience Costs: an Institutionalist Perspective

Exploring China's Audience Costs: An Institutionalist Perspective ∗ Hans H. Tung y This Version: October, 2011 Abstract The recent burgeoning literature of the political economy of dictatorships (Wintrobe, 1998; Bueno de Mesquita et al., 2003; Acemoglu and Robinson, 2006; Gandhi, 2008 ) have made inroads into cracking open the black box of economic policymaking in autocracies, and bringing more insights to the study of non-democratic regimes that used to be dominated by the old totalitarianism paradigm. (Arendt, 1951; Friedrich and Brzezinski, 1965) In the field of international political economy, researchers also start debunking the age-old myth that autocratic leaders are not held accountable domestically. (Weeks, 2008) Along this line of thought, this paper tries to flesh out the argument of autocratic audience costs in the context of a dictatorship, China, that is not only large in size, but also plays a dominant role in all aspects of international political economy. The paper offers an analysis of the political dynamics within the Central Committee of China's Communist Party. It identifies, on the one hand, the key mechanism for the Chinese leadership to be held accountable to its constituent within the Party, and that for it to solicit policy coordination among political elite on the other. Specifying these parameters and their relationship in the model allows us to understand the audience costs the Chinese leadership has to face in the context international policy cooperation. More critically, as far as global governance is concerned, this analysis also makes it possible to assess how credible China's promises to the international community are. Keywords: Autocratic Audience Costs, Career Concerns, Commitment Problem, Reciprocal Accountability ∗I thank Gary Jefferson, Tony Saich, and Beth Simmons for their valuable comments and suggestions on the previous version of this paper. yNational Chengchi University, Graduate Institute of East Asian Studies. 64 Sec. 2, Zhinan Rd. Taipei 116; email: [email protected]. Hans H. Tung is an assistant professor in the Graduate Institute of East Asian Studies at National Chengchi University. He received his Ph.D. in Government from Harvard University in 2011. His broader research interests include domestic sources of China's foreign economic policymaking, regional and global repercussions of China's rise, and, more generally, political economic models for understanding economic policymaking in authoritarian regimes. 1 1 Introduction: Conceptualizing China's Audience Costs "China is certainly a command and controlled economy. They make a decision, and they just do it." ∼ Eleanor Clift 1 The totalitarianism paradigm (Arendt, 1951; Friedrich and Brzezinski, 1965) has a long last- ing influence on how scholars and policymakers think about international behavior of countries without elections. For instance, in his seminal paper on international negotiations, Robert D. Putnam writes "...diplomats representing an entrenched dictatorship are less able than represen- tatives of a democracy to claim credibly that domestic pressures preclude some disadvantageous deal. (1988: 449) Similarly, Eleanor Clift's quote above reflects the popular perception that a dictatorship like China faces no domestic constraints and is able to exert their power arbitrarily. However, the recent burgeoning literature on the political economy of dictatorships (Wintrobe, 1998; Bueno de Mesquita et al., 2003; Acemoglu and Robinson, 2006; Gandhi, 2008 ) has made inroads into cracking open the black box of governmental processes in autocracies, and bringing more insights to the study of domestic sources of economic and foreign policymaking in these regimes that used to be dominated by the old totalitarianism paradigm. In the field of international political economy, researchers also start debunking the age-old myth that autocratic leaders are not held accountable domestically. (Weeks, 2008) This paper enriches the literature by placing the argument couched originally in formal- theoretical or statistical terms in the national context of China, which is the largest and ap- parently the most important autocracy in the world. While, until today, political scientists have still known relatively little about and vehemently debated on how China had attained its success and the way in which its political economy works, there is little doubt about its com- prehensive rise on the world stage and pivotal role in solving all major global governance issues ranging from climate change to global finance (Keohane, 2009; Wang and Rosenau, 2009). As a result, figuring out the sources of accountability within China's political regime, from which its domestic audiences can effectively impose constraints on the political leaders' foreign and economic policy behavior can also have practical significance for global policy communities. To clarify the scope of analysis in this paper and situate its contribution to the literature of audience costs, a simple analytical framework is in order. First of all, according to Weeks (2008) 2 , the generation of audience costs is influenced by three central factors: i) domestic actors can and will coordinate to sanction the leader, ii) domestic audiences disapprove of backing down 3 , and iii) outsiders can observe the leader's insecurity (38-44). These factors constitute 1Eleanor Clift is a contributing editor for Newsweek magazine and these remarks were made in her interview in a NPR radio show, On Point, on August, 6, 2011 (The Week In The News: Markets Tumble, A Debt Deal, FAA Deadlock). 2It should be noticed here that applications of the concept of audience costs go far beyond that (backing down from public threats) in Weeks (2008). (Slantchev, 2006: 446) 3The exposition of this condition given in Weeks (2008: 42) fails to take into account the fact that autocratic (or democratic) leaders' foreign policy behavior { e.g., public threats (Schelling, 1963; Fearon, 1994), monetary credibility (Lohmann, 2003), or trade agreement compliance (Mansfield et al., 2002) { can in fact be endogenous to the first condition. That is, leaders' foreign policy decisions are very likely to have incorporated domestic audiences' policy preferences from the outset. In other words, the latter's disapproval naturally arises from the former's defection from the ex ante decisions, and it does not take a vaguer cause like restoring country's credibility in Weeks (2008) to prove this point. 2 a framework for how audience costs can be understood in general and, more specifically, in China's political context. It can be given formally as: (1) ~ ∗ ACij = βiγij(ACi ) + "ij ∗ 4 where ACi denotes the first factor above that reflects country i's true audience costs , βi the second factor that measures domestic audiences' incentive to punish country i's leader for backing down, γij the third factor that indicates the ability of an outsider, country j, to observe 5 P the insecurity of country i's leader , and "ij (= k ijk) noises comprised of a collection of other factors (ijk) that are not captured by the three main variables but can also weaken or ∗ 6 strengthen the signal of ACij . Moreover, both βi and γij are treated as continuous measures of degrees of domestic audiences' disapproval of backing down and observability of country i 7 leader's insecurity, and range between 0 and 1 (i.e., βi; γij 2 [0; 1]) . What is worth noting here is that the revealed audience costs, AC~ ij, is modeled as an interaction among the three central factors. For example, if other countries (j) are unable to observe the insecurity of political leader in country i (i.e., γij = 0), the contribution of the true audience costs to the revealed costs will be 0 no matter how high the former are. Similarly, when there is no incentive for ∗ domestic audiences to punish (i.e., βi = 0), ACi is essentially irrelevant. To use the analytical framework defined by (1) to explain China's autocratic audience costs, ∗ I further break down ACi to two components corresponding to two different types of domestic actors in China: ∗ ∗ ∗ ACi = ηi + ρi (2) ∗ where ηi represents the audience costs generated by the elite politics within China's party-state ∗ and ρi the costs imposed by societal actors. Plugging (2) into (1) yields: ∗ ∗ AC~ j = βγjη + βγjρ + "j (3) where i is removed from the subscripts of all variables since this paper focuses exclusively on the Chinese case. To further simplify the analysis, first notice that, in general, γij is contingent on the stability of country i's political regime that allows country j to predict political prospects of its leaders. On this regard, the increasing party institutionalization in China's political system in the post-reform period (Gehlbach and Keefer, 2011; Shirk, 1993) justifies the replacement of the variable of γj in (3) with a constant γj that gives rise to the following new expression: ~ ∗ ∗ ACj = γjβη + γjβρ + "j (4) With the model specification in (4), the exploration of China's audience costs can be boiled down to two factors: βη∗ and βρ∗. However, as far as the latter is concerned, while societal 4It is the true audience costs because this factor captures total domestic constraints country i's leader faces before he or she capitalizes on these constraints by revealing them to other countries to signal his or her resolve. 5This is why j is added to γ's subscript. 6A government can manipulate certain information to deceive other countries and generate audience costs that do not actually exist. For instance, in the case of Sino-Japanese relationship, the Chinese government often allows (or even stages, according to a more conspiracist interpretation) nationalist demonstrations against Japan to generate audience costs and secure more foreign policy benefits. Since these demonstrations are hardly an effective way to threaten the Chinese leaders' political survival, they cannot be unambiguously counted as audience costs. However, if Japanese leaders were to be deceived that these demonstrations were spontaneously organized by Chinese people and suppose the value of this factor is big enough, we might obtain a result that ~ ∗ the revealed audience costs exceed the ture costs, i.e., ACij > ACi .

Load more