title: A Theory of Economic Coercion and Fragmentation
abstract: Hegemonic powers, like the United States and China, exert influence on other countriesby threatening the suspension or alteration of financial and trade relationships.Mechanisms that generate gains from integration, such as external economies of scaleand specialization, also increase the hegemon’s power because in equilibrium they makeother relationships poor substitutes for those with a global hegemon. Other countriescan implement economic security policies to shape their economies in order to 