Balance of power and the propensity of conflict

Herbst, Luisa; Konrad, Kai A.; Morath, Florian

doi:10.1016/j.geb.2015.12.013

Cited by 14 publications

(3 citation statements)

References 66 publications

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“…Although the economics and political science literature attempt to explain the roots and emergence of a conflict, they also adopt analytical tools, especially from game theory, to model interstate and intrastate conflicts. For instance, Skaperdas (1992); Powell (1993); Grossman and Kim (1995); Grossman and Mendoza (2001); Hirshleifer (2001); Muthoo (2004); McBride and Skaperdas (2014); and Herbst, Konrad and Morath (2017) [7,[32][33][34][35][36][37][38] ground their analysis of conflict in game theory models to explain their emergence and characterise their main features. All of the above contributions propose a similar solution, consisting of the definition of a set of parameters that drive players to opt for a peaceful settlement of their disputes.…”

Section: Literature Reviewmentioning

confidence: 99%

Insecure Property Rights and Conflicts: How to Solve Them?

2022

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According to the leading literature, the valid enforcement of property rights is a key ingredient for economic development. However, their enforcement can be problematic in international relations, which can be a valid approximation of an anarchic or state of nature environment. In such a context, we do not have a third party that may sanction any illegal behaviour, since the existing international organizations may lack the necessary power to force countries to behave in a specific way. A large variety of papers have attempted to provide a self-enforcing solution to a conflict among players by defining a bargaining range, which may prevent the emergence of a war. Hence, players renounce the fight and leave peacefully, enforcing de facto property rights. In contrast, we propose a model in which contestants decide to solve their dispute by forming a union. The latter can be interpreted in a broad sense, also encompassing the possibility that they form a new political entity. We highlight the welfare implications of that solution and define the non-empty set of parameters, which support such a decision in the long run. Intuitively, from a dual perspective, the model also discloses the circumstances that may lead players to deviate from the union path and split. Therefore, our paper contributes to the literature about the formation and breakdown of countries, although our primary concern is to present a model with an innovative solution to conflicts. Moreover, our work stresses the importance of the enforcement of property rights to guarantee the peaceful development of relations among countries.

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Section: Literature Reviewmentioning

confidence: 99%

Insecure Property Rights and Conflicts: How to Solve Them?

2022

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“…Moreover, these inequalities also affect future expectations in iterated exchange (Zeng et al, 2019). Therefore, when inter-hierarchical exchanges occur, the exercise of power alters the initial, hypothetical centrality of the game, with an eventual shift of the strategies of the players towards disjoint interests (Barker et al, 2015;Campennì and Schino, 2016;Cox et al, 2013;Herbst et al, 2017;Phillips, 2017;Wang et al, 2010) and, eventually, a decreased drive to engage into any deal.…”

Section: Introductionmentioning

confidence: 99%

Segregating socioeconomic classes leads to an unequal redistribution of wealth

2020

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Social living groups are organised in social hierarchies often exhibiting inequalities in beings. Investigating class segregation and the use of punishment applied downward in the rank acts as a key aspect to ascertain how dominant and subordinate partners cooperate to achieve mutual profit. In human subjects coming from countries with an uneven wealth distribution, this mutual profit may be reduced, especially for the lower socioeconomic classes. We implemented an Iterated Prisoner's Dilemma Game experiment in one such country with starkly high inequality, China. We split relatively richer and poorer subjects into separate classes and gave only one the authority to punish the other. When rich subjects could unidirectionally punish poor subjects (as in a segregated society), rich subjects decreased their cooperation effort while punishing poor subjects. When rich and poor subjects, instead, could punish each other in random combinations (as in an integrated society) they decreased defections so they could punish more. In the segregated society model, the punishing classes earned twice as much as the non-punishers. Conversely, in the integrated society model, weak differences in earnings were found, leading to a decrease in inequality. These results were confirmed by an agent-based simulation mirroring the human experiments and repeated during a very large number of rounds. From our research, we conclude that, especially in developing economies, if the states enacted that the dominant and subordinate individuals relinquished their almost segregated state, this would lead to a redistribution of wealth and power.

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“…Our study also relates to the experimental literature on bargaining in the shadow of conflict that examines, among other things, the effect of the asymmetry of conflict on bargaining outcomes (Hoffman and Spitzer, 1985; Kimbrough and Shremeta, 2014; Kimbrough et al ., 2014; Dechenaux et al ., 2015; Herbst et al ., 2017). Anbarci and Feltovich (2013) find that the negotiation strategies do not react to conflict asymmetries as much as the selfish sequentially rational theory would predict, but that QRE and other‐regarding preferences can account for the observed patterns.…”

Section: Introductionmentioning

confidence: 99%

Prospect Theory, Fairness, and the Escalation of Conflict at a Negotiation Impasse*

Miettinen

Ropponen

Sääskilahti³

2020

Scandinavian J Economics

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We study a bilateral negotiation setup where, at a bargaining impasse, the disadvantaged party chooses whether to escalate the conflict or not. Escalation is costly for both parties, and it results in a random draw of the winner of the escalated conflict. We derive the behavioral predictions of a simple social utility function, which is convex in disadvantageous inequality, thus connecting the inequity aversion and the prospect theory models. Our causal laboratory evidence is, to a large extent, consistent with the predicted effects. Among other things, the model predicts that the escalation rate is higher when escalation outcomes are riskier, and that the disagreement rate is lower when the cost of escalating the conflict is higher.

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Balance of power and the propensity of conflict

Cited by 14 publications

References 66 publications

Insecure Property Rights and Conflicts: How to Solve Them?

Insecure Property Rights and Conflicts: How to Solve Them?

Segregating socioeconomic classes leads to an unequal redistribution of wealth

Prospect Theory, Fairness, and the Escalation of Conflict at a Negotiation Impasse*

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