A game theory view of the relationship between the U.S., China and Taiwan

Abstract

The Taiwan Strait issue has been a major concern for those interested in the foreign policy of the United States. For quite some time, the peaceful solution to the Taiwan Strait issue has been a joint objective of the U.S., China and Taiwan. In 1962, the Cuban Missile Crisis between the Soviet Union and the U.S. almost brought about a destructive nuclear war. However, the U.S. applied a brinkmanship strategy that ended the crisis peacefully. Brinkmanship is one of the more interesting applications of game theory. I will apply game theory and analyze possible results of a brinkmanship strategy in the context of the present Taiwan Strait situation. I will use this idea and other examples to illustrate how game theory might be applied to understand the Taiwan Strait issue.