With the end of the Cold War, we must wonder whether there were missed
opportunities to regulate the arms race and global competition, which
nearly bankrupted the United States and contributed to the collapse o
f the Soviet Union. A missed opportunity for agreement is a situation
where there was at least one alternative that the parties to a conflic
t preferred or would have preferred to nonagreement. Hard-core Realist
s argue that states compete for territory, arms and influence because
they have conflicting national interests. Soft-core Realists maintain
that such conflicts are effects of international anarchy and uncertain
ty, and that states can cooperate contingent on reciprocity. I argue t
hat states often fail to cooperate even when they have compatible pref
erences because policy-makers make incorrect inferences about the oppo
nent's motives and intentions, a process that can be illuminated by so
cial psychology. I present three alternative explanations of trust and
distrust in international relations-rational choice, domestic structu
res, and social psychology. If policy-makers are prudent, they will as
sess the other's interests in observing an agreement as well as its re
putation. Often, domestic political structures encourage leaders to pr
omote distrust of an external enemy to legitimize their internal rule
or foreign policy. Finally, distrust may lead policy-makers to dismiss
the other side's cooperative signals or proposals. Distrust can be ov
ercome by making a series of step-by-step agreements in which each sid
e can test the other's good faith at limited cost, or through unilater
al concessions as part of a consistent policy.