ABSTRACT
Carrots are commonly used in domestic politics, as any study of legislative log-rolling, campaign finance, or political patronage would attest. The paper Economic Statecraft puts forward a rational choice explanation for the conditions when inducements are a feasible and preferable option. It argues that only under very special circumstances states opt for the carrot as their preferred policy option, although it will emerge as a second-best option. The theory of carrots developed here suggests why nation-states continue to employ economic or military coercion despite persistent doubts about its utility as a form of statecraft. The first part of plausibility probe uses chi-square tests to examine the effect of democratic regimes on the initiation and success of economic inducements. The second part of this compares US non-proliferation policy toward North Korea and South Korea to examine the sequencing of carrots and sticks. Like any plausibility probe, the empirical results are tentative.
