This paper focuses on the weaponization of interdependences among states. Weaponization refers to one state restricting its international economic relationships (or ‘interdependences’) to inflict economic or political costs on another state. Recent examples include Western sanctions against Russia over Ukraine and Russia’s retaliatory restriction of gas supplies to several European states. We know surprisingly little about two related questions: what determines whether a particular international economic relationship can be weaponized effectively? Why are some states better positioned than others to weaponize their international economic relationships? This gap is unfortunate considering the high stakes policymakers increasingly face when deciding which international economic relationships to encourage and which to cut to prevent becoming subjects of economic coercion. This paper argues that only monopolistic international economic relationships—which a state cannot substitute easily—can be weaponized effectively. States can weaponize the supply and demand side of international economic relationships. Network effects, technological advantages, transaction costs, and natural resources are frequent sources of supply-side monopoly power. On the demand side, the sender’s demand size, the target’s cost structure, the good or service’s differentiation, and transaction costs are important determinants of monopoly power.

Discussant: Hayley Pring
Conveners: John de Bhal, Alonso Gurmendi Dunkelberg, Duncan Snidal