Self-Containment: Achieving Peace in Anarchic Settings
In anarchic settings, the potential rivals are dragged in an arms race that can degenerate in an open war out of mutual suspicion. We propose a novel commitment device for contestants to avoid both arming and fighting. We allow the players to decentralize the two core decisions that determine whether peace or war ensues. While in centralized countries the decision makers are unable to credibly communicate to their foe their willingness not to arm and not to attack, where the two decisions are dissociated there exists scope for not arming with certainty, and hence overcoming the commitment problem that makes war otherwise inevitable. This mechanism complements existing theories on the Democratic Peace.
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