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Bargaining Versus Fighting

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  • Stergios Skaperdas

    (Department of Economics, University of California-Irvine)

Abstract

I examine the determinants of conflict and settlement by embedding probabilistic contests in a bargaining framework. Different costly enforcement efforts (e.g., arming, litigation expenditures) induce different disagreement points and Pareto frontiers. After examining the incentives for settlement, I demonstrate how different division rules and bargaining norms have real, economic effects. I then analyze some sources of conflict. I emphasize long-term, strategic considerations by examining an illustrative model and discussing particular historical examples.

Suggested Citation

  • Stergios Skaperdas, 2006. "Bargaining Versus Fighting," Working Papers 060705, University of California-Irvine, Department of Economics.
    • Handle: RePEc:irv:wpaper:060705
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    References listed on IDEAS

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    21. Anbarci, Nejat & Skaperdas, Stergios & Syropoulos, Constantinos, 2002. "Comparing Bargaining Solutions in the Shadow of Conflict: How Norms against Threats Can Have Real Effects," Journal of Economic Theory, Elsevier, vol. 106(1), pages 1-16, September.
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    Cited by:

    1. McBride, Michael & Skaperdas, Stergios, 2014. "Conflict, settlement, and the shadow of the future," Journal of Economic Behavior & Organization, Elsevier, vol. 105(C), pages 75-89.
    2. Attiat F. Ott & Sang Hoo Bae, 2011. "Modeling Mass Killing: For Gain or Ethnic Cleansing?," Chapters, in: Derek L. Braddon & Keith Hartley (ed.), Handbook on the Economics of Conflict, chapter 4, Edward Elgar Publishing.
    3. Kumar, Vikas, 2011. "Negotiating constitutions for political unions," International Review of Law and Economics, Elsevier, vol. 31(1), pages 58-76, March.
    4. Michael McBride & Gary Milante & Stergios Skaperdas, 2011. "Peace and War With Endogenous State Capacity," Journal of Conflict Resolution, Peace Science Society (International), vol. 55(3), pages 446-468, June.
    5. Klaus Beckmann, 2020. "Konzept für eine Militärökonomik," Working Paper 186/2020, Helmut Schmidt University, Hamburg.
    6. Choi, Michael & Rocheteau, Guillaume, 2024. "Foundations of market power in monetary economies," Journal of Economic Theory, Elsevier, vol. 222(C).
    7. Nicholas Sambanis & Stergios Skaperdas & William Wohlforth, 2017. "External Intervention, Identity, and Civil War," Working Papers 161705, University of California-Irvine, Department of Economics.
    8. Stergios Skaperdas & Samarth Vaidya, 2025. "Guns, Lawyers, and Markets: On Economic and Political Consequences of Costly Conflict," CESifo Working Paper Series 12135, CESifo.
    9. Ansink, Erik & Weikard, Hans-Peter, 2009. "Contested water rights," European Journal of Political Economy, Elsevier, vol. 25(2), pages 247-260, June.
    10. Hwang Joongsan, 2025. "Veto Bargaining with Incomplete Information and Risk Preference: An Analysis of Brinkmanship," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 31(3), pages 259-303.
    11. Anderton,Charles H. & Carter,John R., 2009. "Principles of Conflict Economics," Cambridge Books, Cambridge University Press, number 9780521875578, December.
    12. Charles H. Anderton & John R. Carter, 2011. "A Bargaining Theory Perspective on War," Chapters, in: Derek L. Braddon & Keith Hartley (ed.), Handbook on the Economics of Conflict, chapter 3, Edward Elgar Publishing.
    13. Kyung nok Chun & Zachary Schaller & Stergios Skaperdas, 2020. "Why Are There Strikes?," Revue d'économie politique, Dalloz, vol. 130(6), pages 929-956.
    14. Parashari, Gopal Sharan & Kumar, Vimal, 2020. "Destruction and settlement norms as determinants of conflict: An evolutionary perspective," European Journal of Political Economy, Elsevier, vol. 63(C).
    15. Kimbrough, Erik O. & Rubin, Jared & Sheremeta, Roman M. & Shields, Timothy W., 2015. "Commitment problems in conflict resolution," Journal of Economic Behavior & Organization, Elsevier, vol. 112(C), pages 33-45.
    16. Yang-Ming Chang & Zijun Luo, 2017. "Endogenous Destruction In Conflict: Theory And Extensions," Economic Inquiry, Western Economic Association International, vol. 55(1), pages 479-500, January.
    17. Schaller, Zachary & Skaperdas, Stergios, 2020. "Bargaining and conflict with up-front investments: How power asymmetries matter," Journal of Economic Behavior & Organization, Elsevier, vol. 176(C), pages 212-225.
    18. Madhav S. Aney, 2012. "Conflict with Quitting Rights: A Mechanism Design Approach," Working Papers 18-2012, Singapore Management University, School of Economics.
    19. Michelle Garfinkel & Constantinos Syropoulos, 2022. "International Trade and Stable Resolutions of Resource Disputes," School of Economics Working Paper Series 2022-9, LeBow College of Business, Drexel University.
    20. Erik O. Kimbrough & Roman Sheremeta, 2010. "Make Him an Offer He Can’t Refuse: Avoiding Conflicts through Side Payments," Working Papers 10-23, Chapman University, Economic Science Institute.
    21. Antoine Pietri, 2017. "Les modèles de « rivalité coercitive » dans l’analyse économique des conflits," Revue d'économie politique, Dalloz, vol. 127(3), pages 307-352.
    22. Kimbrough, Erik O. & Sheremeta, Roman M., 2013. "Side-payments and the costs of conflict," International Journal of Industrial Organization, Elsevier, vol. 31(3), pages 278-286.
    23. Andr√©s Zambrano & Hernando Zuleta, 2016. "Revealing the preferences of the FARC," Documentos CEDE 14572, Universidad de los Andes, Facultad de Economía, CEDE.

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    Keywords

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    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process

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