Prospect Theory and Foreign Policy Analysis in the Asia Pacific: Rational Leaders and Risky Behavior.

• Author: Godbole, Avinash
• Position: Book review

Prospect Theory and Foreign Policy Analysis in the Asia Pacific

Rational Leaders and Risky Behavior

By Kai He and Huiyun Feng

London and New York: Routledge, 2013, xvi+155 pages, ISBN 9780415656214.

THEORY, or the principles that help one organise, understand and interpret facts in a better manner, is the central pillar around which any scientifically premised field of research is developed. Credibility of the field of international relations, as an independent and scientific field of research, is based on its theoretical underpinnings. Even then, international relations theory is constantly under the process of refinement as it remains a discursive science despite claims of objectivity. Kai He and Huiyun Feng attempt the same in their book entitled, "Prospect Theory and Foreign Policy Analysis in the Asia Pacific." They study and fill in the gaps in this neoclassical realist interpretation of state behaviour by applying prospect theory, which is originally rooted in the field of Psychology.

He and Feng say that "integration of prospect theory and neoclassical realism helps explain risk taking behavior in world politics, which is sometimes seen as 'irrational behavior' by mainstream international relations scholars" (p. 1-2). The authors claim to go a step further in being able to explain this rather than just qualify it as irrational. They develop a "political legitimacy-prospect model" in order to explain the "rationalist puzzles" in the study of Asian foreign policy and suggest that "political leaders are more likely to make risky decisions when they face a deficit of political legitimacy, i.e., they are seriously challenged domestically and/or internationally, and they are framed in a domain of losses" (p. 2). Using this premise, this book looks at four case studies: the absence of NATO like US led alliance in Asia, North Korea's erratic nuclear posture, China's (apparently) soft stance on Taiwan's pro-independence leadership and China's unexpected compromise, and Japan's unexpected provocations on the East China Sea dispute. Towards this end, the authors use the prospect theory argument that "people tend to evaluate choices with respect to a reference point. People choose risk-averse behaviour in a domain of gains but risk-acceptant behaviour in a domain of losses" (p. 4).

The scope of this book is somewhat limited in that it is not providing an entirely alternate theoretical perspective that challenges the current field of knowledge...