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Reciprocity in the shadow of Threat

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Author Info
Caruso, Raul

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Abstract

This paper considers a partial equilibrium model of conflict where two asymmetric, rational and risk-neutral opponents evaluate differently a contested stake. Differently from common contest models, agents have the option of choosing a second instrument to affect the outcome of the conflict. The second instrument is assumed to capture positive investments in ‘conflict management’ - labelled as ‘talks’. It will be demonstrated that the asymmetry in the evaluation of the stake does constitute a powerful force influencing agents’ behaviour. In particular, (a) whenever the asymmetry in the evaluation of the stake is extremely large there is no room for cooperation and a conflict trap emerges; (b) whenever the degree of asymmetry falls within a critical interval cooperation seems to emerge even if only the agent with the higher evaluation of the stake makes a concession, proportional to the optimal choice of ‘talks’; (c) as the evaluations of the stake converge only reciprocal concessions (capturing a kind of strong reciprocity) made by both agents can pave the way for cooperation. In such a case, the existence of reciprocal concessions paves the way for establishing a potential settlement region (PSR) given that both parties can be better off while expending resources in ‘talks’. Finally, throughout the paper, the concept of entropy is applied as a tool for the measurement and evaluation of conflict and conflict management.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 1788.

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Date of creation: Feb 2007
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Handle: RePEc:pra:mprapa:1788

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Related research
Keywords: Conflict Contest Conflict management conflict resolution concessions reciprocity asymmetry in evaluation Statistical entropy cooperation integrative systems ‘guns’ and ‘talks’.

Find related papers by JEL classification:
D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information
D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Miles Corak, 2001. "Are the Kids All Right? Intergenerational Mobility and Child Well-being in Canada," The Review of Economic Performance and Social Progress, in: Andrew Sharpe, Executive Director & France St-Hilaire, Vice-President , Research & Keith Banting, Di (ed.), The Review of Economic Performance and Social Progress 2001: The Longest Decade: Canada in the 1990s, volume 1 Centre for the Study of Living Standards & The Institutute for Research on Public Policy. [Downloadable!]
    Other versions:
  2. Grawe, Nathan D., 2001. "In Search of Intergenerational Credit Constraints Among Canadian Men: Quantile Versus Mean Regression Tests for Binding Credit Constraints," Analytical Studies Branch Research Paper Series 2001158e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  3. Menzie D. Chinn, 2005. "A Primer on Real Effective Exchange Rates: Determinants, Overvaluation, Trade Flows and Competitive Devaluation," NBER Working Papers 11521, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  4. David I. Levine & Bhashkar Mazumder, 2002. "Choosing the right parents: changes in the intergenerational transmission of inequality between 1980 and the early 1990s," Working Paper Series WP-02-08, Federal Reserve Bank of Chicago. [Downloadable!]
  5. Miles Corak & Andrew Heisz, 1998. "The Intergenerational Earnings and Income Mobility of Canadian," Labor and Demography 9808001, EconWPA. [Downloadable!]
  6. Jorge N. Valero-Gil & Jose A. Tijerina-Guajardo, 2002. "Effects of Education on the Intergenerational Transmission of Labor Income in Mexico," Eastern Economic Journal, Eastern Economic Association, vol. 28(3), pages 381-392, Summer. [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Caruso, Raul, 2007. "A Tentative Model of Conflict, Appropriation and Production in a two-sector Economy," MPRA Paper 4053, University Library of Munich, Germany. [Downloadable!]
  2. Caruso, Raul, 2007. "Continuing Conflict and Stalemate: A Note," MPRA Paper 2316, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  3. Caruso, Raul, 2007. "THE Economics of Match-Fixing," MPRA Paper 3085, University Library of Munich, Germany. [Downloadable!]
  4. Caruso, Raul, 2008. "Spesa Pubblica E Criminalità Organizzata In Italia Evidenza Empirica Su Dati Panel Nel Periodo 1997-2003," MPRA Paper 6861, University Library of Munich, Germany. [Downloadable!]
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