Reciprocity in the shadow of threat
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.
(This abstract was borrowed from another version of this item.)
Volume (Year): 55 (2008)
Issue (Month): 1 (April)
|Contact details of provider:|| Web page: http://www.springer.com|
Web page: http://www.heirs.it/
|Order Information:||Web: http://www.springer.com/economics/policy/journal/12232/PS2|
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.:
- Jack Hirshleifer, 1987. "Comments on Gordon Tullock's THE ECONOMICS OF CONFLICT," UCLA Economics Working Papers 454, UCLA Department of Economics.
- Nti, Kofi O, 1999. "Rent-Seeking with Asymmetric Valuations," Public Choice, Springer, vol. 98(3-4), pages 415-30, March.
- Basu, Kaushik, 2006.
"Coercion, Contract and the Limits of the Market,"
06-01, Cornell University, Center for Analytic Economics.
- Jack Hirshleifer, 1993.
"The Dark Side of the Force,"
UCLA Economics Working Papers
702, UCLA Department of Economics.
- Usher, D, 1987. "Theft as a Paradigm for Departures from Efficiency," Oxford Economic Papers, Oxford University Press, vol. 39(2), pages 235-52, June.
- Raul Caruso, 2007.
"Continuing Conflict and Stalemate: A note,"
AccessEcon, vol. 4(17), pages 1-8.
- Ernst Fehr & Simon Gaechter, .
"Fairness and Retaliation: The Economics of Reciprocitys,"
IEW - Working Papers
040, Institute for Empirical Research in Economics - University of Zurich.
- Ernst Fehr & Simon Gächter, 2000. "Fairness and Retaliation: The Economics of Reciprocity," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 159-181, Summer.
- Ernst Fehr & Simon Gaechter, 2000. "Fairness and Retaliation: The Economics of Reciprocity," CESifo Working Paper Series 336, CESifo Group Munich.
- Kyung Hwan Baik & Shogren, Jason F., 1995. "Contests with spying," European Journal of Political Economy, Elsevier, vol. 11(3), pages 441-451, September.
- Garfinkel, Michelle R. & Skaperdas, Stergios, 2007.
"Economics of Conflict: An Overview,"
Handbook of Defense Economics,
- Herschel I. Grossman, 1999.
"Producers and Predators,"
NBER Working Papers
6499, National Bureau of Economic Research, Inc.
- Sherwin Rosen, 1985.
"Prizes and Incentives in Elimination Tournaments,"
NBER Working Papers
1668, National Bureau of Economic Research, Inc.
- Hirshleifer, Jack, 1987. "Economic Behaviour in Adversity," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226342825.
- Grossman, Herschel I, 1991. "A General Equilibrium Model of Insurrections," American Economic Review, American Economic Association, vol. 81(4), pages 912-21, September.
- Garance Genicot & Stergios Skaperdas, 2002.
"Investing in Conflict Management,"
Journal of Conflict Resolution,
Peace Science Society (International), vol. 46(1), pages 154-170, February.
- Kjell Hausken, 2005. "Production and Conflict Models Versus Rent-Seeking Models," Public Choice, Springer, vol. 123(1), pages 59-93, April.
- Caruso, Raul, 2006.
"Conflict and Conflict Management with Interdependent Instruments and Asymmetric Stakes,(The Good-Cop and the Bad-Cop Game),"
214, University Library of Munich, Germany, revised Sep 2006.
- Caruso Raul, 2006. "Conflict and Conflict Management with Interdependent Instruments and Asymmetric Stakes, (The Good-Cop and the Bad-Cop Game)," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 12(1), pages 1-55, September.
- Robert J. Aumann & Sergiu Hart, 2003.
"Long Cheap Talk,"
Econometric Society, vol. 71(6), pages 1619-1660, November.
- Skaperdas, Stergios, 1996.
"Contest Success Functions,"
Springer;Society for the Advancement of Economic Theory (SAET), vol. 7(2), pages 283-90, February.
- Raul Caruso, 2005. "Asimmetrie negli incentivi, equilibrio competititvo e impegno agonistico: distorsioni in presenza di doping e combine," Rivista di Diritto ed Economia dello Sport, Centro di diritto e business dello Sport, vol. 1(3), pages 13-38, Dicembre.
- Bhagwati, Jagdish N, 1982. "Directly Unproductive, Profit-seeking (DUP) Activities," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 988-1002, October.
- Gil S. Epstein & Carsten Hefeker, 2003. "Lobbying contests with alternative instruments," Economics of Governance, Springer, vol. 4(1), pages 81-89, 04.
- Neary, Hugh M, 1997. "Equilibrium Structure in an Economic Model of Conflict," Economic Inquiry, Western Economic Association International, vol. 35(3), pages 480-94, July.
- Garfinkel, M.R. & Skaperdas, S., 2000.
"Conflict without Misperceptions or Incomplete Information: how the Future Matters,"
99-00-11, California Irvine - School of Social Sciences.
- Michelle R Garfinkel & Stergios Skaperdas, 2001. "Conflict Without Misperceptions or Incomplete Information: How the Future Matters," Levine's Working Paper Archive 563824000000000011, David K. Levine.
- Skaperdas, Stergios & Syropoulos, Constantinos, 1996. "Can the shadow of the future harm cooperation?," Journal of Economic Behavior & Organization, Elsevier, vol. 29(3), pages 355-372, May.
- repec:ebl:ecbull:v:4:y:2007:i:17:p:1-8 is not listed on IDEAS
- Nash, John, 1953. "Two-Person Cooperative Games," Econometrica, Econometric Society, vol. 21(1), pages 128-140, April.
- Arye L. Hillman & John G. Riley, 1987.
"Politically Contestable Rents and Transfers,"
UCLA Economics Working Papers
452, UCLA Department of Economics.
- O'Keeffe, Mary & Viscusi, W Kip & Zeckhauser, Richard J, 1984. "Economic Contests: Comparative Reward Schemes," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 27-56, January.
- J. Amegashie, 2006. "A contest success function with a tractable noise parameter," Public Choice, Springer, vol. 126(1), pages 135-144, January.
- Caruso, Raul, 2007. "Conflict and Conflict Managment with Asymmetric Stakes (The Bad-Cop and the Good Cop part II)," MPRA Paper 1438, University Library of Munich, Germany.
- Skaperdas, Stergios, 1992.
"Cooperation, Conflict, and Power in the Absence of Property Rights,"
American Economic Review,
American Economic Association, vol. 82(4), pages 720-39, September.
- Skaperdas, S., 1991. "Cooperation, Conflict And Power In The Absence Of Property Rights," Papers 90-91-06a, California Irvine - School of Social Sciences.
- Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-98, December.
- Acemoglu,Daron & Robinson,James A., 2009.
"Economic Origins of Dictatorship and Democracy,"
Cambridge University Press, number 9780521671422, October.
- Enrico Spolaore, 2004. "Economic Integration, International Conflict and Political Unions," Rivista di Politica Economica, SIPI Spa, vol. 94(5), pages 3-50, September.
- Christian Riis & Derek J. Clark, 1997. "Contest success functions: an extension," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 11(1), pages 201-204.
- Anderton, Charles H & Anderton, Roxane A & Carter, John R, 1999. "Economic Activity in the Shadow of Conflict," Economic Inquiry, Western Economic Association International, vol. 37(1), pages 166-79, January.
- Nti, Kofi O., 2004. "Maximum efforts in contests with asymmetric valuations," European Journal of Political Economy, Elsevier, vol. 20(4), pages 1059-1066, November.
- Raul Caruso, 2004. "A Trade Institution as a Peaceful Institution?," Others 0406003, EconWPA, revised 15 Dec 2004.
When requesting a correction, please mention this item's handle: RePEc:spr:inrvec:v:55:y:2008:i:1:p:91-111. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.