From ‘shelving sovereignty’ to ‘regularized patrol’?: prospect theory and Sino–Japanese islands dispute (2012–14)

Abstract

Abstract The article draws on prospect theory to explain the variation of China’s risk propensity during the 2012–14 Diaoyu/Senkaku islands disputes with Japan. China’s initial reference point 1.0 regarding the disputed islands was the ‘shelving agreement’ ‘shelving the sovereignty dispute and a tacit acceptance of Japan’s de facto exclusive control. So after Japan’s ‘nationalization’ of the Diaoyu/Senkaku islands, China was clearly in a domain of losses. China was thus highly risk-acceptant by intensifying maritime and air patrolling, engaging in provocative behaviors, and suspending crisis management mechanisms. Meanwhile, China’s reference point evolved. Discourse analysis of Chinese official statements and media coverage indicated that regularized patrolling or joint control became China’s reference point 2.0. As it started to act from a domain of gains, Chinese behaviors turned risk-averse by scaling back patrolling and resuming negotiations over crisis management mechanisms.