SIGNALING FOREIGN-POLICY INTERESTS - TYING HANDS VERSUS SINKING COSTS

The author distinguishes between two types of costly signals that stat e lenders might employ in trying to credibly communicate their foreign policy interests to other states, whether in the realm of grand strat egy or crisis diplomacy. Leaders might either (a) tie hands by creatin g audience costs that they will suffer ex post if they do not follow t hrough on their threat or commitment (i.e., costs arising from the act ions of domestic political audiences) or (b) sink costs by taking acti ons such as mobilizing troops that are financially costly ex ante. Ana lysis of a game model depicting the essentials of each case yields two principal results. First, in the games' equilibria, leaders never blu ff with either type of signal; they do not incur or create costs and t hen fail to respond if challenged. Second, leaders do better on avenge by tying hands, despite the fact that the ability to do so creates a greater ex ante risk of war than does the use of sunk-cost signals. Th ese results and the logic behind them may help explain some empirical features of international signaling, such as many crises' appearance a s competitions in creating domestic political audience costs. They als o generate empirical puzzles, such as why the seemingly plausible logi c of inference that undermines bluffing in the model does not operate in all empirical cases.