Dr. Atip Asvanundไทย
Trade Wars & Economic Statecraft

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8:17YOUTUBE

Summary

What is happening is not only a trade war but a game of nerve, staked on the fear and psychology of leaders everywhere.

Game theory yields four scenarios: everyone negotiates, nobody backs down, some negotiate and some refuse, and the unexpected case.

The question for Thailand is which scenario it ends up in, and that depends on whether it has read the other side correctly.

Key points

  1. In a game of chicken both sides can lose

    Unlike a game with a guaranteed winner, this one has an outcome that is terrible for everyone if nobody yields.

  2. Seeming unreasonable is an advantage

    Here, credibility that you will not swerve is worth more than being reasonable.

  3. A small country has fewer options than the theory suggests

    The cost of holding is not the same for Thailand as for the United States, so the game is not symmetric.

  4. Coalition changes the game but is hard to build

    If small countries combined, the balance would shift — which is why these measures are usually negotiated one at a time.