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The Slippery Slope of Concession

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  • Jack Hirshleifer
  • Michele Boldrin
  • David K Levine

Abstract

We show that with common knowledge and a common rate of time preference, the potential loser can always avoid wasteful conflict through a time‐consistent series of small concessions. We examine how the failure of each of these assumptions may explain why conflicts arise. We also debate which actions may be helpful in such unfortunate circumstances.
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  • Jack Hirshleifer & Michele Boldrin & David K Levine, 2007. "The Slippery Slope of Concession," Levine's Working Paper Archive 618897000000001057, David K. Levine.
    • Handle: RePEc:cla:levarc:618897000000001057
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    References listed on IDEAS

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    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    2. Muhamet Yildiz, 2003. "Bargaining without a Common Prior-An Immediate Agreement Theorem," Econometrica, Econometric Society, vol. 71(3), pages 793-811, May.
    3. Jack Hirshleifer, 2001. "Appeasement: Can It Work?," American Economic Review, American Economic Association, vol. 91(2), pages 342-346, May.
    4. Hirshleifer, Jack, 1991. "The Technology of Conflict as an Economic Activity," American Economic Review, American Economic Association, vol. 81(2), pages 130-134, May.
    5. Durham, Yvonne & Hirshleifer, Jack & Smith, Vernon L., 2008. "The Paradox of Power," Handbook of Experimental Economics Results, in: Charles R. Plott & Vernon L. Smith (ed.), Handbook of Experimental Economics Results, edition 1, volume 1, chapter 16, pages 127-137, Elsevier.
    6. Ali, S. Nageeb M., 2006. "Waiting to settle: Multilateral bargaining with subjective biases," Journal of Economic Theory, Elsevier, vol. 130(1), pages 109-137, September.
    7. Shavell Steven & Spier Kathryn E., 2002. "Threats Without Binding Commitment," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 2(1), pages 1-11, January.
    8. Anat R. Admati & Motty Perry, 1987. "Strategic Delay in Bargaining," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 54(3), pages 345-364.
    9. Jack Hirshleifer, 1989. "Conflict and rent-seeking success functions: Ratio vs. difference models of relative success," Springer Books, in: Roger D. Congleton & Arye L. Hillman & Kai A. Konrad (ed.), 40 Years of Research on Rent Seeking 1, pages 251-262, Springer.
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    Cited by:

    1. Stergios Skaperdas, 2006. "Bargaining Versus Fighting," Defence and Peace Economics, Taylor & Francis Journals, vol. 17(6), pages 657-676.
    2. Maxime Menuet & Petros G. Sekeris, 2021. "Overconfidence and conflict," Economic Inquiry, Western Economic Association International, vol. 59(4), pages 1483-1499, October.
    3. Serhat Doğan & Kerim Keskin & Çağrı Sağlam, 2023. "Analyzing strategic behavior in a dynamic model of bargaining and war," Journal of Economics, Springer, vol. 140(3), pages 233-257, December.
    4. Daron Acemoglu & Georgy Egorov & Konstantin Sonin, 2015. "Political Economy in a Changing World," Journal of Political Economy, University of Chicago Press, vol. 123(5), pages 1038-1086.
    5. Yared, Pierre, 2010. "A dynamic theory of war and peace," Journal of Economic Theory, Elsevier, vol. 145(5), pages 1921-1950, September.

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