Opportunity Costs and South Korea’s Nuclearization

South Korea’s launch of its Indo-Pacific strategy in December 2022 started the country’s ascent into “strategic clarity” for the US-led Indo-Pacific construct, winning favor with Washington for this policy shift. However, in January 2023, President Yoon Suk-yeol voiced the possibility of either building nuclear weapons indigenously or redeploying US tactical nuclear weapons in the face of an ever-growing nuclear threat from the Democratic People’s Republic of Korea (DPRK or North Korea). This reoriented the debate on South Korea’s own nuclear ambitions

https://www.38north.org/2023/10/south-korea-as-a-nuclear-state-trade-offs-and-choices/

Thus begins a piece authored by Jagannath Panda over at 38North. If you’re wondering about the name of the blog, click here.

So, should South Korea nuclearize or not?

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Opportunity costs are everywhere, and this question is a way for us to understand how to apply principles of economics to a tragically important question:

1. South Koreans are increasingly distrustful of the US commitment to South Korea’s security. The government in South Korea has reaffirmed Seoul’s commitment to the NPT, but about seventy percent of South Koreans approve of the country going nuclear. There is certainly a political incentive to keep the issue alive.
2. Having North Korea (and then China) as neighbors is an excellent argument for going nuclear is what many South Koreans will tell you. You may or may not agree with them, but you do see where they’re coming from.
3. It could make, proponents argue, North Koreans less militarily adventurous.
4. Look at India, they might say. They have Pakistan and China as neighbors, and they went nuclear. Didn’t hurt them too much, now did it?
   • I mean sure, the US imposed sanctions, and cut off all assistance except humanitarian aid.
   • But especially after 9/11, they had no choice but to walk those back, right?
   • Russia and France didn’t say much back then, and got back to BFF status pretty quickly
5. Well, maybe so. But I wouldn’t be so sure about the “didn’t hurt them too much” bit!
   • Some would say geopolitical uncertainty in the region went up, not down, after the nuclear tests
   • Pakistan went nuclear too – and they almost had to, in a way. Did that make things better, or worse?
   • The Kashmir issue gained prominence on the international stage, and India didn’t exactly want that, now did it?
6. South Korea can launch a charm offensive in case they do go nuclear, and apart from its overt dependence on China when it comes to trade, things should be ok.
7. Plus, of course South Korea will adopt a no-first-use doctrine.
8. But think about this:
   • Is South Korea better off with the threat to go nuclear, or with actually going nuclear?
     • Will the USA be more or less incentivized to provide security to South Korea?
     • Will going nuclear stop or accelerate North Korea’s nuclear program?
     • Will going nuclear increase or decrease military activity at the border?
     • Will this increase or reduce the chances of an arms race in the region (and not just North or South Korea, but all countries in that region)?

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The answer to the question, it turns out, is not a simple one. Your ability to answer this question depends on how you frame your analysis:

1. Who are the impacted parties (directly and indirectly)?
2. Who are the impacted parties (immediately and eventually)?
3. What are the first order impacts on all of these parties?
4. What are the second order impacts on all of these parties?
5. Are you analyzing the short term, medium term or long term impacts?
6. Which of these impacts are you giving greater weightage to? Why?

And bear in mind, of course, that this is a good list to keep in mind when you’re analyzing opportunity costs in general, not just in the case of opining about whether South Korea should go nuclear!