Geopolitics: cooperation vs competition

What is geopolitics, and who acts in it?

Geopolitics is the study of how geography affects politics and international relations. Analysts follow the actors who carry out political, economic and financial activity, and how those actors deal with one another.

Geopolitical actorsanyone who carries out political, economic or financial activity across borders

• State actors Memorize control national security and resources
  • Governments and political bodies
  • Leaders and officials
• Non-state actors Memorize act across borders without a state's security or resources
  • Companies and multinationals
  • NGOs and charities
  • Influential individuals

State actors are governments, political bodies and leaders. They control national security and a country’s resources. Non-state actors are companies, nongovernmental organizations (NGOs), charities and influential individuals. They operate across borders but do not command an army or own a nation’s resources.

Relationships are webs, not pairs. How Country A treats Country B depends partly on how B treats A’s allies and on what A’s firms are doing in B.

What does cooperation look like?

Memorize

Cooperation is two or more actors working together toward shared goals. A cooperative country and a non-cooperative country differ in how they set rules and how they answer their partners.

Cooperative country	Non-cooperative country
Standardized, consistent rules	Inconsistent or arbitrary rules
Harmonized tariffs	Restricted trade, capital controls
Free movement of goods, services, capital and people	Restricted movement across borders
Reciprocates	Retaliates
Shares technology and information	Limits technology exchange

Cooperation needs both engagement and reciprocity. A country that sells to everyone but never matches a partner’s concessions is engaging, not cooperating.

Exam tip When two answers both involve trade, pick the one where the other side’s move is matched. Matching is reciprocity; punishing is retaliation.

Why do countries cooperate?

A country cooperates when doing so advances its national interest : its military, economic and cultural goals. Six forces shape how far it goes.

Drivers of cooperationall flow from the national interest

• National security Memorize neighbors, shipping lanes, borders
• Economic interest Memorize secure resources, level the field for national firms
• Resource endowment Use it rich countries gain leverage, poor ones need partners
• Standardization Use it shared protocols cut cross-border costs
• Culture and soft power Use it influence without force
• Institutions Know the idea rule of law and accountability make cooperation last

• National security. A landlocked country depends on its neighbors for access to the sea. A country on a key shipping lane can use its location as leverage over others.
• Economic interest. Cooperation can secure essential inputs through trade, or level the playing field for national firms by agreeing common rules.
• Resource endowment. A country’s geophysical resource endowment is the natural wealth its geography gives it, such as energy, minerals, arable land or ports. Resource-rich countries gain leverage. Resource-poor ones need partners.
• Standardization. Shared protocols, such as bank regulation, payment messaging and shipping container sizes, cut the cost of dealing across borders. Standardization is both a sign of cooperation and a cause of more of it.
• Culture and soft power. Shared history, migration ties and cultural links give countries reasons to cooperate. Soft power is a way of influencing another country’s decisions without force or coercion, built through education exchanges, travel grants and cultural exports. It is a tool of influence, not itself a sign of political cooperation.
• Institutions. An institution is an established set of rules and organizations. Strong rule of law and accountability make agreements dependable, so cooperation lasts.

How does a country choose between goals?

Memorize

A country’s national interest is not one goal but a list. The hierarchy of interests ranks goals from those essential for survival, at the top, to nice-but-not-essential ones lower down. When two goals conflict, the higher one wins.

For example, a country locked in a border dispute may turn down the cheapest bid for its new phone network because the bidder comes from the rival state. The saving is real, but control of its communications sits higher on the list. Short political cycles push long-term issues down the list, and a leader’s own motives add unpredictability.

Go deeper Standards that made cross-border trade cheaper

Know the idea

Three examples show how a shared rule can unlock large flows. Standard container sizes let a box move between ship, rail and truck without repacking. Common messaging formats let banks in different countries settle payments with each other. International bank capital rules let supervisors compare banks in different countries on the same basis. None of these requires countries to like each other, only to agree on a technical format, which is why standardization is often the first form of cooperation.

Go deeper Sanctions as coercion of a non-cooperative state

Know the idea

When a state will not cooperate, others may try to push it with sanctions, which cut its access to trade or finance. They can change behavior, but they also fall on ordinary people and on firms in the sanctioning countries, and they can push the target toward other partners. Lesson 5 places sanctions among the financial tools.