Economic Considerations in the Comparison Between Assured Destruction and Assured Survival

Abstract

One consequence of the Reagan Administration’s intensified R&D efforts on strategic defence has been to re-enliven debate over Assured Destruction versus Assured Survival as alternative strategies for managing the nuclear threat of humanity. As between these two doctrines clarification of the issues is to be achieved by investigating the incentives each side might confront under alternative assumptions as to the outcome of SDI research including (i) incentives to deploy various strategic systems and (ii) incentives to utilise them. This chapter will utilise the concepts of goods, preferences, technology, and cost to investigate (i) how an assured survival strategy might come to rival an assured destruction strategy; (ii) how new, defensive-oriented cost and technology might influence the stability of the arms race; and (iii) how new cost and technology structures might influence strategic doctrines or objectives including incentives to refrain from striking first. Emphasis is placed on the relative costs of deterrence versus defence plus the degree of technological jointness in the production of these two capabilities as crucial determinants of the incentive structure of interest. Costs matter, both as positive predictors of potential future behaviour of great powers, and as normative criteria for strategic decision. The paper derives alternative cost measures for comparing offensive vs defensive effectiveness.

Department of Economics University of Maryland. This was written while the author was Visiting Professor, Osaka University. Support from the Department of Economics, Osaka University, and from the Japanese Fulbright Commission is gratefully acknowledged.