ECONOMY

874 democracy, peace, and war
1.2 Audience Costs
Fearon’s (1994) “audience costs” model is closely related to but theoretically distinct
from the public constraints argument. Starting from a somewhat different premiss
from the public opinion literature, the “audience costs” literature begins with the
assumption that war is an inefficient solution to a bargaining problem (Fearon
1995). One reason states might adopt an inefficient policy is because state A cannot
credibly signal to state B what A’s true resolve or cost tolerance is. This line of
reasoning is explicitly strategic, in that the problem or cause of war or peace lies in one
side’s strategic incentives to misrepresent its own capabilities. The theoretical focus is
on leaders’ ability or lack thereof to decipher their opponent’s resolve.
The audience costs permutation of the signaling model of war is based on the
indirect effects of anticipated electoral punishments, and assumes that during international
crises states are uncertain about each other’s resolve for war (resolve here
refers to how willing the opposing sides are to fight and therefore bear the high costs
of war to defend their interests). Because a state’s costs of fighting are related to both
its own resolve as well as its opponent’s, states have incentives to adopt policies short
of war to try to force their opponents to reveal credible information about their levels
of resolve. Escalating a diplomatic crisis by mobilizing one’s military forces is one way
in which a state can attempt to communicate its resolve to the other side, that it will
fight to defend its interests, and in doing so, hopefully get the other side to back down.
In the audience costs approach, domestic politics enters the picture when leaders
consider what might happen if they back down after precipitating or escalating a
crisis. The audience costs model proposes that potential voters will view backing
down in a crisis as a policy failure, and when able, will therefore punish at the polls
leaders that back down in a crisis. Institutions matter in that citizens of authoritarian
states are less able to inflict political costs on their leaders than voters are in states with
elected leaders. Notably, some audience costs models have focused on the political
opposition rather than on the public (Schultz 2001).
From the audience costs perspective, all leaders know that dictators are freer to
back down, and hence more likely to bluff, than are elected leaders. In turn, according
to this logic, because a democratic leader will suffer greater punishment from backing
down than an authoritarian counterpart will, the democrat will be likely to step up the
escalatory ladder only when he or she is unlikely to back down; that is, when he or she
has a high resolve for war. Ironically, this becomes an advantage for democracies, as a
democracy’s decision to escalate a crisis is a stronger signal of its resolve for war than
is an autocrat’s decision to escalate. When democracies escalate they really “mean it,”
but when autocrats escalate, they are more likely than democracies to be bluffing.
Relatedly, some have proposed that democratic domestic audiences are more likely to
punish political leaders for reneging on international agreements like alliances, which
in turn makes cooperation between democracies more likely (Leeds 1999).
Empirical testing of audience costs models is at this stage preliminary. However,
one central audience costs hypothesis is that when a democracy escalates a crisis,
the other side should be significantly more likely to back down, as the prospective