In August 1993, as the shadow of the Cold War began its slow retreat, the United Nations (UN) Conference on Disarmament decided the time was ripe to negotiate a treaty banning nuclear tests once and for all. The end of superpower competition had led three of the five official nuclear powers – the United States (US), Russia, and Britain – to announce testing moratoriums, and nonnuclear states were eager for a universal ban.1 The biggest potential spoiler was China. A “vocal outsider to the global nuclear order”2 and a “latecomer to the nuclear club,”3 China had historically viewed test ban efforts as “ploys intended to monopolize nuclear weapons and solidify the larger nuclear powers’ advantages.”4

This chapter discusses IST itself as well as the research design of the book. It provides a detailed exposition of the key variables of the theory: the status-seeking strategies of rising powers, institutional openness, and procedural fairness. It discusses the causal mechanism that explains the impact of openness and fairness on a rising power’s status and corresponding choice of strategy. It generates four possible strategies a state may follow: cooperate, challenge, expand, and reframe. On research design, the chapter describes the scope conditions of the theory, definitions of key concepts, case selection, research methodology and sources, and the observable implications of the theory and how they differ from the observable implications of alternative (materialist) explanations.

This chapter recapitulates IST’s central assumptions and predictions, as well as the findings from the case studies. It identifies a number of empirical patterns emerging from the cases, which suggest areas for future research. The chapter also identifies alternative methodologies for testing IST and concludes with a discussion of IST’s implications for theories of power shifts and international order. Finally, it discusses the policy implications of IST for the future of the liberal international order.

This chapter lays down the conceptual foundations of Institutional Status Theory. It situates IST in the literature on status in world politics, and on social identity in particular. It elaborates on the concept of status as an intrinsic value and as a role that entails symbolic equality with higher-status actors, as distinct from status as a set of valued attributes. It discusses the psychological and social foundations of IST, in particular its relationship to and difference from constructivist theory. Finally, the chapter theorizes the great-power club and international institutions as sites of status struggles.

This chapter presents the book’s third case study, exploring how state transformation shapes China’s international development financing (DF) policymaking and implementation. DF is often seen as an instrument of economic statecraft, strategically deployed to advance China’s geopolitical interests. Contrarily, we show that authority and policymaking is fragmented and contested among central agencies, producing weak oversight for implementing state-owned enterprises, which have primarily pecuniary motives and scant regard for official Chinese diplomatic goals. DF projects thus emerge not from a ‘top-down’ strategy but in a ‘bottom-up’ way, reflecting the agency of buccaneering SOEs and recipient-country elites. The outcomes of DF projects – and whether they benefit China’s international relations – depend on how the specific interests on both sides intersect, as we show through comparative case studies of hydropower development in Cambodia and Myanmar. In Cambodia, Chinese DF was managed by a dominant-party regime in ways that bolstered its domination, generating warmer ties with Beijing. In Myanmar, however, socio-political fragmentation meant that similar projects exacerbated social conflict and even sparked renewed civil war, prompting a crisis in bilateral relations.

This chapter introduces the book and its main arguments. It first discusses the International Relations debate over China’s rise, and its limitations. The debate is polarised between those depicting China as a revisionist actor, or as supporting the status quo. The debate is at an impasse because evidence exists on both sides. What is needed is a framework that can account for both sorts of behaviour. This requires rejecting the assumption that China is a monolithic actor pursuing a coherent grand strategy. In reality, since the late 1970s, the Chinese party-state has become fragmented, decentralised and internationalised, greatly expanding the range of actors involved in China’s foreign affairs. Because these actors are only loosely coordinated within a Chinese-style regulatory state, this produces a wide range of international outcomes that do not necessarily reflect top leaders’ intentions. The chapter also outlines the structure and contents of the rest of the book.

This chapter presents the book’s first case study: the South China Sea (SCS). Typically, the SCS is seen as a geopolitical struggle for sovereignty and territory, prompting military tensions and power balancing, and as a major security flashpoint that could spark World War III. This chapter shows that Chinese conduct in the SCS is shaped less by a detailed strategy determined in Beijing and more by struggles for power and resources within the transformed Chinese party-state. Reflecting the model described in Chapter One, Chinese conduct is only loosely guided by the poorly-defined nine-dash line and an injunction to balance the maintenance of stability and the protection of maritime rights, which are often contradictory objectives. This has created wide latitude for maritime actors – including the navy, coastguard agencies, the national oil companies and the Hainan provincial government and associated fishing interests – to promote their sectional interests, with often very negative consequences for China’s wider diplomatic objectives. Xi Jinping’s efforts to rein in competing actors has only partially succeeded. Although China’s position in the SCS has overall strengthened, it has done so in a rather unplanned manner and consequently at considerable cost.

This chapter presents the book’s second case study: Chinese efforts to manage ‘non-traditional’ security issues in the Greater Mekong Subregion. It focuses on the challenges of illegal narcotics and associated criminal activity, particularly banditry on the Mekong river, to which China has become more exposed through its ‘reform and opening up’. Contrary to widespread assumptions that ‘Westphalian’ China is leery of undermining sovereignty, we show that Chinese agencies have actually moved to tackle these problems at source by sponsoring opium-substitution programmes and transboundary law-enforcement projects in Laos and Myanmar. The outcomes of these interventions depend on how Chinese party-state transformation dynamics interact with socio-political conflicts in these target states. On the Chinese side, opium-substitution has been hijacked by local cadre-capitalists in Yunnan province, skewing implementation towards their sectional interests. This has intersected with predatory social relations in Myanmar and Laos to undermine drug-suppression efforts. Conversely, Chinese central government agencies have had greater success in corralling neighbouring counterparts into a transnational policing network, recently cemented into a new international organisation, the Lancang-Mekong Law Enforcement and Security Centre.

The concluding chapter draws out the implications of our findings for scholars and policymakers. First, it identifies key patterns in our findings and proposes hypotheses for further research. Inductively, it suggests that the degree of Chinese policy coherence reflects whether coordinating mechanisms are deployed and effective, and whether powerful domestic interests align. It argues that our conceptualisation of the Chinese party-state does not necessarily mean that Chinese behaviour is unproblematic – but that it may emerge for reasons not anticipated by traditional models. And it emphasises the crucial importance of partner/recipient countries in shaping the outcomes of Chinese overseas engagements. Secondly, the chapter draws out recommendations for policymakers in China and elsewhere. We argue that responding to China’s rise as though it was a strategically guided monolith is clearly mistaken, requiring a more nuanced and sophisticated approach. We also urge Chinese policymakers to be more open about the limitations of Chinese governance and to attempt more decisive state reforms. In a final postscript, we offer some thoughts about what light the state transformation framework can shed on the COVID-19 pandemic.

This chapter elaborates the theoretical and methodological approach used in this book. Guided by Gramscian state theory, we trace the post-1978 rise of a powerful, though divided, cadre-capitalist class, and the associated, uneven and contested fragmentation, decentralisation and internationalisation of China’s party-state. We then elaborate a theoretical model capable of explaining how policymaking and implementation work under these changed conditions: the Chinese-style regulatory state. In this model, rather than making detailed, binding decisions and strategies, top leaders try to loosely steer and coordinate a plethora of actors towards favoured ends. But other actors can influence, interpret and even ignore these policy frameworks. Chinese behaviours thus represent an ongoing struggle within the fractured party-state. Outcomes are further shaped by socio-political dynamics within the other countries in which Chinese actors operate. The chapter also explains our method and case selection, and canvasses and rejects some predictable objections to our argument: that China’s state transformation is nothing new, and that recentralisation under Xi Jinping has made the state transformation argument outdated.

This introductory chapter first reviews the major categories of goods: private, public, common-pool, and club, and discusses the concept of good specificity – essentially, the number of possible suppliers – which matters to the politics of substitution. It then turns toward a discussion of how this volume defines and understands international order: An important feature of international order is its “goods ecology” – that is, patterns in the production, supply, quality, and nature of international goods. The next major section elaborates the logic of goods substitution, which serves as the common framework for the chapters in the book, before illustrating how many of the goods in international politics are cultural or symbolic in character and having performative dimensions. The chapter concludes by laying out the plan of the volume and the contents of each of the chapters.

In this chapter, Cooley and Nexon argue that instead of operating with a continuum from “revisionist” to “status quo” powers, we should rather focus on the broader strategic environment in which power political maneuvers take place. This is an international goods ecology, comprising types of goods and their distribution. The key advantage of studying power politics as operating within such an asset ecology is how order itself then becomes something different from polarity or hegemony. This makes it possible to distinguish between challenges to the power position of the hegemon and challenges to the architecture of the international order itself. Cooley and Nexon therefore develop an alternate typology of how international orders are challenged to show how acts of substitution are themselves potentially order transforming. They argue that US-led hegemonic order may be undermined before any overt challenge to the power position of the United States emerges. The main benefit of studying the logic of asset substitution is that it gives us a tool to assess how seemingly unimportant acts of substitution, bit by bit and regardless of a lack of revisionist intent, can shape and transform the international order.

This chapter examines efforts to establish new global rules to restrict export subsidies for coal-fired power plants, which are highly polluting and a major contributor to climate change. Government-backed export credit for coal power plants acts as a form of export subsidy, and thus promotes the expansion of such plants abroad. The US spearheaded multilateral negotiations within the context of the OECD Arrangement to prohibit the use of export credit for coal power plants. However, since China is not part of the Arrangement, it was not a participant in the negotiations or bound by the new disciplines created. China’s absence, I argue, weighed heavily over the negotiations and undermined efforts to construct an ambitious agreement. OECD exporters were extremely resistant to agree to restrict their use of export credit when China—the world’s largest supplier of export credit for overseas coal plants, accounting for nearly half of all export credit in this sector—would face no similar restraints on supporting its exports. Without China’s participation, the impact of the resulting agreement is severely limited. This case thus highlights the difficulty of building effective global trade rules today without the participation of China.

This concluding chapter situates the arguments made in this book within ongoing debates about the nature of hierarchy and equality in international relations. It then turns to reflect on the implications of the closure thesis in light of contemporary developments that seem to point to an opening of the system forced by the diffusion of power away from the West or away from the nation-state. It identifies in the closure thesis one explanation for why we are witnessing institutional fragmentation instead of institutional reform in response to the global power shift. Finally, the chapter considers possible future transformations and the potential for creating more egalitarian global relations.