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Alliances Among Asymmetric Countries

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  • Prabal Roy Chowdhury

Abstract

We examine alliances between asymmetric countries. We find that the results depend on the nature of the equilibrium. If the equilibrium is an interior one then, with an increase in asymmetry, the level of the alliance-wide defense good decreases and the divergence between the first best and the equilibrium level of the defense good increases. In the case where the equilibrium involves a corner solution, these results are reversed. It may be argued, however, that the interior equilibrium case is the more relevant one.

Suggested Citation

  • Prabal Roy Chowdhury, 2007. "Alliances Among Asymmetric Countries," Defence and Peace Economics, Taylor & Francis Journals, vol. 18(3), pages 253-263.
  • Handle: RePEc:taf:defpea:v:18:y:2007:i:3:p:253-263
    DOI: 10.1080/10242690600925213
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    References listed on IDEAS

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    1. Cornes, Richard & Hartley, Roger & Sandler, Todd, 1999. " Equilibrium Existence and Uniqueness in Public Good Models: An Elementary Proof via Contraction," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 1(4), pages 499-509.
    2. Sandler, Todd, 1977. "Impurity of Defense: An Application to the Economics of Alliances," Kyklos, Wiley Blackwell, vol. 30(3), pages 443-460.
    3. Keith Hartley & Todd Sandler, 2001. "Economics of Alliances: The Lessons for Collective Action," Journal of Economic Literature, American Economic Association, vol. 39(3), pages 869-896, September.
    4. Wong, K-Y., 1988. "Foreign Trade, Military Alliance, And Defence-Burden Sharing," Discussion Papers in Economics at the University of Washington 88-11, Department of Economics at the University of Washington.
    5. Weber, S. & Wiesmeth, H., 1990. "Economic Models of NATO," Papers 90-7, York (Canada) - Department of Economics.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Alliance; Asymmetry; Public good; Defence;

    JEL classification:

    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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