While Robert Higgs’s formulation of the ratchet effect has been productively applied to domestic policy, it hasn’t been well used to examine foreign policy. We explore a two-country ratchet effect, where each nation’s interventionist expansions serve as crises for the other, leading to a cyclical escalation in government size and scope. Then we apply this model to U.S.-China foreign policy from the 1970s to the present.

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Ryan M. Yonk is a Research Fellow at the Independent Institute and Senior Research Faculty at the American Institute for Economic Research.
Alec Stamm is a graduate student in the Department of Agricultural Economics and Economics, Montana State University.
AsiaInternational Economics and Development
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