The Great Catalyst by unknow

Author:unknow
Language: eng
Format: epub
Publisher: Lexington Books/Fortress Academic
Published: 2013-08-15T00:00:00+00:00

Table 10.2. Time Preferences and Discount Factor Intervals

The table shows that the Type 1’s range of time preferences shrinks, as the discount rate δ must be lower than smaller thresholds for the Type 1 to cooperate. The Type 1 cooperates with Turkey by becoming progressively impatient as cooperation payoff loses value. We can therefore assert that the Type 1 cooperates only if it discounts future payoffs to an extent that varies with Turkish failures. If the new TFP capsizes, domestic reforms stall, or Turkish economic stability becomes deeply shaken, time preferences of the Type 1 start to matter for its behavior towards Turkey. The Type 1 avoids an uncertain future so that the future casts a shadow upon present relations. One would intuitively expect that if future matters, some EU countries would have a higher tendency to cooperate with Turkey. Unfortunately, this might not be the case. Turkish failures induce the Type 1 to cooperate only if it evaluates future gains of the accession process as not valuable as the present ones.

What about Turkish reactions to the European Union? According to the pooling equilibrium, Turkey reacts by walking out the accession process if the European Union defects, for example, if the European Union decides to suspend accession negotiations as Turkey does not open its ports to Greek Cypriot vessels.18 The values of B1 and B2, Turkish evaluations of cooperative and defective moves emanating from the European Union respectively, determine the critical threshold for Turkey to stop negotiations with the European Union.

We can offer two hypotheses assuming Turkish successes and failures shape B1 and B2 as well. First, if Turkey becomes successful, it could evaluate EU defection as representing lesser costs. According to Turkish leaders, Turkey having a better functioning democratic system, a stronger economy, and an increased influence and power through its new foreign policy might even not want an EU membership. Political reforms, for example, are not necessarily conducted to meet EU criteria; they are tools to improve Turkish standards of living. Or, perhaps, Turks simply will not desire their country to become an EU member in the future. Some analysts think the EU membership is no more the principal Turkish national interest (Zalewski 2010: 97). Recent speeches emanating from the highest-rank Turkish leaders indicate that a reversal in Turkish preference might actually occur in the long run.19 National priorities can change.

Hence, if both types defect and Turkey is successful, B2 (assumed as a negative payoff) can approach zero. Turkish cost of facing EU defective moves becomes lower producing smaller values of the threshold B2 / ( B2 – B1 ). Suppose that B1 = 2 and B2 takes the values of (–2), (–1) and (–½), that is, the Turkish cost decreases. The threshold becomes equal to ½, ⅓ and ⅕, respectively. Turkey chooses to exit observing both types’ defection provided that 0 ≤ p ≤ ½, 0 ≤ p ≤ ⅓ and 0 ≤ p ≤ ⅕. As a result, facing a full EU defection, the intervals of Turkish beliefs of interacting with the Type 1 and thus to quit the accession process shrink.

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