Rivalry, Capacity, and GEO Activity: Evidence from a Staggered Difference-in-Differences Design

The purpose of this research is to explore the effects of geopolitical competition on national behavior in geostationary orbit (GEO) in the context of yearly launches into GEO. Using the country-year unit of analysis, we first observe a positive relationship between rivalry pressure and GEO behavior. In order to progress past mere descriptive findings, a difference-in-difference model with staggered treatment assignment is then used to test our hypothesis of a causal link between rivalry and increased GEO activity. Using both two-way fixed effects as well as the Sun-Abraham interaction-weighted specification, we observe a statistically significant increase in GEO behavior after the shock of heightened rivalry pressure. This effect is particularly pronounced in nations with existing capabilities both within the aerospace industry as well as space exploration more generally, meaning that rivalry pressure does not produce GEO capability out of thin air but serves to amplify activities where such capability already exists. Robustness tests including placebo tests, alternative treatments, leave-one-group-out tests, and pre-trend diagnostics consistently reaffirm the key finding. Additional analyses including Cox proportional hazard models show that rivalry explains very little beyond the effects of existing capability on GEO activity.