“A Three-Party Game of Institutional Resilience versus Transition A Model and Comparative History of China-Japan Revisited” by Professor Jiahua Che
STRATEGY AND IB SEMINAR
Professor Jiahua Che
Department of Economics
Institutional transformation takes many forms, some fall into prolonged conflicts, others turn out to be swift and somewhat bloodless. We present a simple model of state building to capture such dichotomy. Our analysis demonstrates that countries with weaker state capacity and wider political differences among potential political challenges against the existing ruler tend to fall into the conflict trap and will end up with more concentrated political structure. We apply our analysis in reflecting two landmark institutional transitions taking place in the late 19th century Japan and the early 20th century China, that have since separated the two countries apart. Our analysis sheds light on the cause as well as the long-term implications of this divergence.