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The attack‐and‐defense conflict with the gun‐and‐butter dilemma

Author

Listed:
  • Subhasish M. Chowdhury
  • Iryna Topolyan

Abstract

We analyze a general equilibrium model of attack and defense with production. One attacker and one defender allocate fixed endowments between producing butter and guns. We characterize the unique interior and unique corner equilibrium, and find that (i) the defenders may spend more resources on conflict than the attacker even without loss aversion or other preferential bias, (ii) the attackers may expend all their resources only in conflict, and (iii) the interior and the corner equilibria cannot coexist. These results may help explain Ukraine's sustained high defense effort and Russia's militarized economy, or the excessive conflict expenditure by Hamas etc.

Suggested Citation

  • Subhasish M. Chowdhury & Iryna Topolyan, 2026. "The attack‐and‐defense conflict with the gun‐and‐butter dilemma," Economic Inquiry, Western Economic Association International, vol. 64(1), pages 245-260, January.
    • Handle: RePEc:bla:ecinqu:v:64:y:2026:i:1:p:245-260
    DOI: 10.1111/ecin.70020
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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • Q34 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Natural Resources and Domestic and International Conflicts

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