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Mediation and Peace

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This paper brings mechanism design to the study of conflict resolution in international relations. We determine when and how unmediated communication and mediation reduce the ex ante probability of conflict, in a simple game where conflict is due to asymmetric information. Unmediated communication helps reducing the chance of conflict as it allows conflicting parties to reveal their types and establish type-dependent transfers to avoid conflict. Mediation improves upon unmediated communication when the intensity of conflict is high, or when asymmetric information is large. The mediator improves upon unmediated communication by not precisely reporting information to conflicting parties, and precisely, by not revealing to a player with probability one that the opponent is weak. Surprisingly, in our set up, arbitrators who can enforce settlements are no more effective in reducing the probability of conflict than mediators who can only make non-binding recommendations.

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  • Johannes Horner & Massimo Morelli & Francesco Squintani, 2010. "Mediation and Peace," Cowles Foundation Discussion Papers 1765, Cowles Foundation for Research in Economics, Yale University.
  • Handle: RePEc:cwl:cwldpp:1765
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    Cited by:

    1. Michael D. König & Dominic Rohner & Mathias Thoenig & Fabrizio Zilibotti, 2016. "The Long-lasting Shadow of the Allied Occupation of Austria on its Spatial Equilibrium," HiCN Working Papers 231, Households in Conflict Network.
    2. Goltsman, Maria & Pavlov, Gregory, 2014. "Communication in Cournot oligopoly," Journal of Economic Theory, Elsevier, vol. 153(C), pages 152-176.
    3. Dominic Rohner, 2018. "Success Factors for Peace Treaties: A Review of Theory and Evidence," Cahiers de Recherches Economiques du Département d'économie 18.08, Université de Lausanne, Faculté des HEC, Département d’économie.
    4. Kimbrough, Erik O. & Laughren, Kevin & Sheremeta, Roman, 2020. "War and conflict in economics: Theories, applications, and recent trends," Journal of Economic Behavior & Organization, Elsevier, vol. 178(C), pages 998-1013.
    5. Mostafa Beshkar & Jee-Hyeong Park, 2017. "Dispute Settlement with Second-Order Uncertainty: The Case of International Trade Disputes," CAEPR Working Papers 2017-010, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.
    6. Herbst, Luisa & Konrad, Kai A. & Morath, Florian, 2017. "Balance of power and the propensity of conflict," Games and Economic Behavior, Elsevier, vol. 103(C), pages 168-184.
    7. Correia-da-Silva, João, 2020. "Self-rejecting mechanisms," Games and Economic Behavior, Elsevier, vol. 120(C), pages 434-457.
    8. Mueller, Hannes Felix & Rauh, Christopher, 2019. "The Hard Problem of Prediction for Conflict Prevention," CEPR Discussion Papers 13748, C.E.P.R. Discussion Papers.
    9. Zheng, Charles Z., 2019. "Necessary and sufficient conditions for peace: Implementability versus security," Journal of Economic Theory, Elsevier, vol. 180(C), pages 135-166.
    10. Wolton, Stephane, 2018. "Signaling in the shadow of conflict," MPRA Paper 83922, University Library of Munich, Germany.
    11. Govinda Clayton & Han Dorussen, 2022. "The effectiveness of mediation and peacekeeping for ending conflict," Journal of Peace Research, Peace Research Institute Oslo, vol. 59(2), pages 150-165, March.
    12. Iaryczower, Matias & Oliveros, Santiago, 2016. "Power brokers: Middlemen in legislative bargaining," Journal of Economic Theory, Elsevier, vol. 162(C), pages 209-236.
    13. Ganguly, Chirantan & Ray, Indrajit, 2015. "Information-Revelation and Coordination Using Cheap Talk in a Game with Two-Sided Private Information," Cardiff Economics Working Papers E2015/7, Cardiff University, Cardiff Business School, Economics Section.
    14. Corchón, Luis C. & Yıldızparlak, Anıl, 2013. "Give peace a chance: The effect of ownership and asymmetric information on peace," Journal of Economic Behavior & Organization, Elsevier, vol. 92(C), pages 116-126.
    15. Laurent-Lucchetti, Jérémy & Rohner, Dominic & Thoenig, Mathias, 2019. "Ethnic Conflicts and the Informational Dividend of Democracy," CEPR Discussion Papers 14182, C.E.P.R. Discussion Papers.
    16. Michael D. König & Dominic Rohner & Mathias Thoenig & Fabrizio Zilibotti, 2017. "Networks in Conflict: Theory and Evidence From the Great War of Africa," Econometrica, Econometric Society, vol. 85, pages 1093-1132, July.
    17. Raphaela Hennigs, 2019. "Conflict Prevention by Bayesian Persuasion," Working Papers tax-mpg-rps-2019-16_1, Max Planck Institute for Tax Law and Public Finance.
    18. Meirowitz, Adam & Morelli, Massimo & Ramsay, Kristopher & Squintani, Francesco, 2019. "Third Party Intervention and Strategic Militarization," CEPR Discussion Papers 13879, C.E.P.R. Discussion Papers.
    19. Björn Gehrmann, 2019. "Third-party diplomacy," HiCN Working Papers 312, Households in Conflict Network.
    20. Gehrmann, Björn, 2019. "Krieg, Frieden und Mediation - eine wettkampftheoretische Perspektive [War, Peace and Mediation - a Contest Theory Perspective]," MPRA Paper 93645, University Library of Munich, Germany.
    21. Eguia, Jon X., 2022. "Multilateral regime change," Journal of Public Economics, Elsevier, vol. 205(C).
    22. Kim, Jin Yeub, 2017. "Interim third-party selection in bargaining," Games and Economic Behavior, Elsevier, vol. 102(C), pages 645-665.
    23. Jin Yeub Kim, 2022. "Neutral public good mechanisms," PLOS ONE, Public Library of Science, vol. 17(4), pages 1-16, April.
    24. Andrea Canidio & Joan-Maria Esteban, 2018. "Benevolent Mediation in the Shadow of Conflict," Working Papers 1027, Barcelona School of Economics.
    25. Catalina Tejada & Eliana Ferrara & Henrik Kleven & Florian Blum & Oriana Bandiera & Michel Azulai, 2015. "State Effectiveness, Growth, and Development," Working Papers id:6668, eSocialSciences.

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    More about this item

    Keywords

    Mediation; War and peace; Imperfect information; Communication games; Optimal mechanism;
    All these keywords.

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

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