The China Ratchet

Extending Higgs’s Model to Explore Foreign Policy

By Ryan M. Yonk, Alec Stamm

This article appeared in the Spring 2025 issue of The Independent Review.

While Robert Higgs’s formulation of the ratchet effect has been productively applied to domestic policy, it hasn’t been well used to examine foreign policy. We explore a two-country ratchet effect, where each nation’s interventionist expansions serve as crises for the other, leading to a cyclical escalation in government size and scope. Then we apply this model to U.S.-China foreign policy from the 1970s to the present.

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Ryan M. Yonk
is a Research Fellow at the Independent Institute and Senior Research Faculty at the American Institute for Economic Research.
Alec Stamm
is a graduate student in the Department of Agricultural Economics and Economics, Montana State University.