710 Conflict Exbectations The answers to these questions are not trivial.The use of economic coercion in international relations has a long pedigree;the Athenian boycott of Megara was one of the triggering events of the Peloponnesian War.The end of the Cold War has brought this tool of statecraft renewed prominence.The United States has threat- ened or implemented economic coercion against more than forty countries since 1990.The Russian Federation has been quite willing to employ economic coercion as a way of gaining political concessions from the newly independent states.As public resistance to military interventions has increased,policymakers are turning more and more to economic statecraft as an alternative policy option.I The increased prominence of economic coercion has led to an increase in the scholarly literature,but not much progress has been made.With some notable exceptions (Martin,1992;Morgan and Schwebach,1997)most of the recent contributions consist of well-crafted theories that lack empirical support(Eaton and Engers,1992;Smith,1996),or well-crafted case studies that produce generalizations of dubious quality (Galtung,1967;Cortright and Lopez,1995;Klotz,1996).One scholar claims that the one constant about economic sanctions is that each event is purposefully random (Tsebelis,1990).Furthermore,most of the literature has focused on the outcomes of coercion attempts;there has been little research explain- ing when senders will initiate threats or acts of economic sanctions. This article uses a simple game-theoretic model to develop a theory of economic coercion that can answer those questions.The short-run opportunity costs of sanctions imposition are important,but they are not the only factor.Just as important to explaining economic coercion are the expectations of future bilateral conflict held by the target and sender countries.Conceding in the face of economic coercion implies a redistribution of assets between the target and sender.Nation- states care about this redistribution if they think it will harm their bargaining position in future conflicts.This expectation of future conflict is translated into a short-run concern for relative gains and reputation that varies with the expectation of future threats or conflicts in the bilateral relationship between the sender and target. Conflict expectations is an abstract concept that can be empirically measured by observing the alignment between the target and the sender.Allies will expect fewer political conflicts than adversaries.Adversaries will expect more zero-sum conflicts in the future,and so will care more about the material and reputational repercus- sions of existing conflicts.Because of heightened conflict expectations,adversaries will care more than allies about relative gains and reputation for bargaining toughness. The expectation of future conflict has a contradictory effect on economic coer- cion.On the one hand,it makes senders more willing to threaten economic sanctions.The greater the concern for relative gains,the more likely the sanctioner will prefer a stalemate outcome of disrupted economic exchange and attempt to coerce.With adversaries,a sender will be willing to incur significant costs,provided the target incurs even greater costs.With an ally,the costs to itself must be less and the costs to the target must be greater before the sender will attempt economic I In this article,I switch between the terms ecomnomic coercion,economic statecraf,and economic sanctions in the interest of style,but I am much more comfortable with the first term because of its inclusiveness.There is an odd demarcation line between what is described as a sanctions event and what is not.For example,the United States imposed trade sanctions on South Africa in 1985.The sanctions were threatened and then implemented as a way of putting pressure on South Africa's government to end apartheid.In 1997,the United States pressured the World Bank to postpone loans to Croatia until that country more closely adhered to the Dayton Accord provisions on refugees and war criminals.The former event is commonly described as a sanctions episode,while the latter is not.They are both efforts at economic coercion,however,and the theory developed here will try to explain both events.See Baldwin,1985,for a further discussion.710 Conjict Expectations The answers to these questions are not trivial. The use of economic coercion in international relations has a long pedigree; the Athenian boycott of Megara was one of the triggering events of the Peloponnesian War. The end of the Cold War has brought this tool of statecraft renewed prominence. The United States has threat￾ened or implemented economic coercion against more than forty countries since 1990. The Russian Federation has been quite willing to employ economic coercion as a way of gaining political concessions from the newly independent states. As public resistance to military interventions has increased, policymakers are turning more and more to economic statecraft as an alternative policy option.1 The increased prominence of economic coercion has led to an increase in the scholarly literature, but not much progress has been made. With some notable exceptions (Martin, 1992; Morgan and Schwebach, 1997) most of the recent contributions consist of well-crafted theories that lack empirical support (Eaton and Engers, 1992; Smith, 1996), or well-crafted case studies that produce generalizations of dubious quality (Galtung, 1967; Cortright and Lopez, 1995; Klotz, 1996). One scholar claims that the one constant about economic sanctions is that each event is purposefully random (Tsebelis, 1990). Furthermore, most of the literature has focused on the outcomes of coercion attempts; there has been litt,le research explain￾ing when senders will initiate threats or acts of economic sanctions. This article uses a simple game-theoretic model to develop a theory of economic coercion that can answer those questions. The short-run opportunity costs of sanctions imposition are important, but they are not the only factor. Just as important to explaining economic coercion are the expectations of future bilateral conflict held by the target and sender countries. Conceding in the face of economic coercion implies a redistribution of assets between the target and sender. Nation￾states care about this redistribution if they think it will harm their bargaining position in future conflicts. This expectation of future conflict is translated into a short-run concern for relative gains and reputation that varies with the expectation of future threats or conflicts in the bilateral relationship between the sender and target. Conflict expectations is an abstract concept that can be empirically measured by observing the alignment between the target and the sender. Allies will expect fewer political conflicts than adversaries. Adversaries will expect more zero-sum conflicts in the future, and so will care more about the material and reputational repercus￾sions of existing conflicts. Because of heightened conflict expectations, adversaries will care more than allies about relative gains and reputation for bargaining toughness. The ex~ectation of future conflict has a contradictorv effect on economic coer- i cion. On the one hand, it makes senders more willing to threaten economic sanctions. The greater the concern for relative gains, the more likely the sanctioner will prefer a stalemate outcome of disrupted economic exchange and attempt to coerce. With adversaries, a sender will be willing to incur significant costs, provided the target incurs even greater costs. With an ally, the costs to itself must be less and the costs to the target must be greater before the sender will attempt economic 1 In this article, I switch between the terms economic coercion, economic statecraft, and economic sunctions in the interest of style, but I am much more comfortable with the first term because of its inclusiv~ness. There is an odd demarcation line between what is described as a sanctions event and what is not. For example, the United States imposed trade sanctions on South Africa in 1985.The sanctions were threatened and then implemented as a way of putting pressure on South Africa's government to end apartheid. In 1997,the United States pressured the World Bank to postpone loans to Croatia until that country more closely adhered to the Dayton Accord provisions on refugees and war criminals. The former event is commonly described as a sanctions episode, while the latter is not. They are both efforts at economic coercion, however, and the theory developed here will try to explain both events. See Baldwin, 1985, for a further discussion