Is diplomacy an Option? Finance Theory and Brexit

In finance, experts have spent decades developing complex investment instruments known as Options to minimize the risk taken by investors speculating on the market. Options are highly mathematical, which suits the quantitative field of Financial Economics. However, many aspects of Options are grounded in inter-temporal philosophical concepts suitable for qualitative fields of study, including international strategy and diplomacy. This paper argues that Options Theory provides ready-made models and concepts for diplomacy in rapidly changing contexts, but has as yet been under-exploited in the field of international relations. Drawing on the work of Elie Ayache and Robert Meister, I argue that an international political Options theory is not only possible but already exists. I demonstrate this claim by applying Options Theory to anticipated negotiations and strategic realignments that the United Kingdom is engaging in as the reality of Brexit approaches its denouement amidst a disintegrating Western Liberal Democratic alliance.