Smart Power and Military Force: An Introduction

Abstract

Smart power is comprised of two elements: the quest for building society among states and between states and non-state actors; as well as the desire for cleaner forms of power projection. This special issue explores how states continue to fumble over achieving the optimum mix of hard and soft power across several country cases and themed articles. This set of contributions suggests that smart power is not unlike a ‘Swiss Army Knife’ analogy: multifunctional and challenging to choose the right combination of ideational and material tools.     

The insurgency of the Vendée

The insurrection in the Vendée combined open warfare with the methods of petite guerre, ambushing French republican soldiers and cutting their supply lines to Paris. These tactics, when combined with the hatreds generated by a civil war, go far to explain to the cruelty of the conflict in the west and the depth of the hatreds it engendered. In republican eyes the use of guerrilla tactics was unjust and illegitimate, and they denounced their adversaries as common criminals and brigands, portraying them as backward, superstitious, even as subhuman, and in the process justified the savage repression they unleashed against them.     

Impact of reseller's and sales agent's forecasting accuracy in a multilayer supply chain

We consider a three‐layer supply chain with a manufacturer, a reseller, and a sales agent. The demand is stochastically determined by the random market condition and the sales agent's private effort level. Although the manufacturer is uninformed about the market condition, the reseller and the sales agent conduct demand forecasting and generate private demand signals. Under this framework with two levels of adverse selection intertwined with moral hazard, we study the impact of the reseller's and the sales agent's forecasting accuracy on the profitability of each member. We show that the manufacturer's profitability is convex on the reseller's forecasting accuracy. From the manufacturer's perspective, typically improving the reseller's accuracy is detrimental when the accuracy is low but is beneficial when it is high. We identify the concrete interrelation among the manufacturer‐optimal reseller's accuracy, the volatility of the market condition, and the sales agent's accuracy. Finally, the manufacturer's interest may be aligned with the reseller's when only the reseller can choose her accuracy; this alignment is never possible when both downstream players have the discretion to choose their accuracy. © 2014 Wiley Periodicals, Inc. Naval Research Logistics 61: 207–222, 2014     

Return policy: Hassle‐free or your money‐back guarantee?

This article compares the profitability of two pervasively adopted return policies—money‐back guarantee and hassle‐free policies. In our model, a seller sells to consumers with heterogeneous valuations and hassle costs. Products are subject to quality risk, and product misfit can only be observed post‐purchase. While the hassle‐free policy is cost advantageous from the seller's viewpoint, a money‐back guarantee allows the seller to fine‐tune the consumer hassle on returning the product. Thus, when the two return policies lead to the same consumer behaviors, the hassle‐free policy dominates. Conversely, a money‐back guarantee can be more profitable even if on average, high‐valuation consumers experience a lower hassle cost than the low‐valuation ones. The optimal hassle cost can be higher when product quality gets improved; thus, it is not necessarily a perfect proxy or signal of the seller's quality. We further allow the seller to adopt a mixture of these policies, and identify the concrete operating regimes within which these return policies are optimal among more flexible policies. © 2014 Wiley Periodicals, Inc. Naval Research Logistics 61: 403–417, 2014     

Strategic outsourcing under technology spillovers

We study a supply chain in which an original equipment manufacturer (OEM) and a contract manufacturer (CM) compete in the finished goods market. The OEM can decide whether to outsource the intermediate good, a critical component for producing the finished good, from the CM or make in‐house production. Technology transition improves the CM's production efficiency, and it can take two different forms: a direct technology transfer from the OEM to the CM or technology spillovers through outsourcing from the OEM to the CM. We document the possibility of strategic outsourcing, that is, the CM supplies the intermediate good to the OEM when she is less efficient than the OEM's in‐house production. We find that technology spillovers can strengthen the incentive for strategic outsourcing. Furthermore, compared with direct technology transfers, outsourcing coupled with technology spillovers may generate more technology transition. Outsourcing is a particularly appropriate channel for implicit collusion when the OEM is not very efficient with the production of the intermediate good. Our results suggest that ex post competition on the finished goods can create room for ex ante collaboration and provide some implications on the OEM's outsourcing strategies when facing a competitive CM.© 2014 Wiley Periodicals, Inc. Naval Research Logistics 61: 501–514, 2014     

A PANEL DATA ANALYSIS OF THE NEXUS BETWEEN DEFENCE SPENDING AND GROWTH IN THE EUROPEAN UNION: A REPLY

Hatzinikolaou raises a number of issues related mainly to the econometrics of our paper. These issues are categorized according to the three stages of econometric analysis: specification, estimation, and diagnostic checking. We categorize our reply to his comments accordingly.     

Defense spending and economic growth across the Taiwan straits: a threshold regression model

This paper employs both linear and non‐linear models to investigate the relationship between national defense spending and economic growth for Taiwan and China. Using data from 1953–2000 on defense spending, GDP, import, export and capital, we find that China's defense spending leads that of Taiwan. There exists the phenomenon of an arms race between both countries when official Chinese data are used. On the one hand, feedback relations prevail between economic growth and defense spending growth in Taiwan. On the other hand, China's national defense is found to lead economic growth.     

Aid versus sanctions for taming oppressors: theory and case study of the Iraqi Kurds

We model an oppressor aiming at victimizing an excluded group in his country, with two main variants. A foreign power affects his behaviour using either conditional aid, subject to the dictator’s participation constraint, or the threat of sanctions, broadly defined, subject to the credibility constraint. The choice between the two is either determined by the latter, or by their relative cost. Aid is preferred when the threat of sanctions is ineffective, and sanctions are too expensive. Sanctions might be imposed, if the threat is ineffective. A case study of the Iraqi Kurds after Iraq was subject to sanctions is presented.     

TERRORISM: FACTS FROM FIGURES 1

If international terrorism is on a rising trend, an important source of confirmation or refutation of this is time‐series data on terrorist activity. Using chiefly data collected by the RAND/MIPT consortium we show using basic statistical analysis that in the period 1968–2005 the yearly number of all international terrorist incidents shows no trend over time, but fluctuates year on year in a random manner. On the other hand some indicators do show a definite trend over time, principally the steady rise in the number of incidents that are death‐dealing in nature. A further conclusion is drawn, showing that the proportion of these incidents leading to deaths above a given level is virtually fixed.     

THE FATE OF DISPUTED TERRITORIES: AN ECONOMIC ANALYSIS

This paper presents a simple model to characterize the outcome of a land dispute between two rival parties using a Stackelberg game. Unlike Gershenson and Grossman (2000 Gershenson, D. and Grossman, H.I. 2000. Civil conflict: ended or never ending?. Journal of Conflict Resolution, 44(6): 807–821.  [Google Scholar]), we assume that the opposing parties have access to different technologies for challenging and defending in conflict. We derive the conditions under which territorial conflict between the two parties is less likely to persist indefinitely. Allowing for an exogenous destruction term as in Garfinkel and Skaperdas (2000 Garfinkel, M. and Skaperdas, S. 2000. Conflict without misperceptions or incomplete information: how the future matters. Journal of Conflict Resolution, 44(6): 793–807. [Crossref], [Web of Science ®] , [Google Scholar]), we show that, when the nature of conflict becomes more destructive, the likelihood of a peaceful outcome, in which the territory’s initial possessor deters the challenging party, increases if the initial possessor holds more intrinsic value for the disputed land. Following Siqueira (2003 Siqueira, K. 2003. Conflict and third‐party intervention. Defence and Peace Economics, 14(6): 389–400. [Taylor & Francis Online], [Web of Science ®] , [Google Scholar]), our model has policy implications for peace through third‐party intervention.