The Economic Consequences of a War between PRC and Japan: A Simulation

Posted: 7 Oct 2014

See all articles by Mario Arturo Ruiz Estrada

Mario Arturo Ruiz Estrada

University of Malaya (UM) - Faculty of Economics & Administration (FEA)

Jungsuk Kim

Sogang University - Institute of International and Area Studies

Donghyun Park

Nanyang Technological University (NTU); Asian Development Bank

Date Written: October 7, 2014

Abstract

This paper introduces a new economic model of a wartime economy, the war economic capability model – WEC-Model. The WEC-Model assesses the economic impacts of countries thorough the possible scenario of war in three different stages: (i) initial conflict and diplomatic negotiations; (ii) military conflict; and (iii) winners and losers in the post-war stage. The analysis makes use of new indicators such as economic desgrowth (-δ), war intensity (αi), war losses (-π), economic wear (Π), level of war tension (ζ), level of diplomatic negotiations (η), and total economic leaking (Ωt).Lastly, we apply the WEC-Model to evaluate an imaginary war between the People’s Republic of China (PRC) and Japan.

Keywords: conflict, conflict management, asymmetric conflict, war

JEL Classification: R11, R12

Suggested Citation

Ruiz Estrada, Mario Arturo and Kim, Jungsuk and Park, Donghyun, The Economic Consequences of a War between PRC and Japan: A Simulation (October 7, 2014). Available at SSRN: https://ssrn.com/abstract=2506448

Mario Arturo Ruiz Estrada (Contact Author)

University of Malaya (UM) - Faculty of Economics & Administration (FEA) ( email )

Kuala Lumpur, 50603
Malaysia
+60126850293 (Phone)

HOME PAGE: http://ssrc.um.edu.my/

Jungsuk Kim

Sogang University - Institute of International and Area Studies ( email )

35 Baekbeom-ro
Mapo-gu
Seoul, Seoul 121-742
Korea, Republic of (South Korea)

Donghyun Park

Nanyang Technological University (NTU) ( email )

S3 B2-A28 Nanyang Avenue
Singapore, 639798
Singapore

Asian Development Bank

6 ADB Avenue, Mandaluyong City 1550
Metro Manila
Philippines

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