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Recirpcity in the shadow of Threat

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  • Caruso, Raul

Abstract

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.

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  • Caruso, Raul, 2007. "Recirpcity in the shadow of Threat," MPRA Paper 1788, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:1788
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    Cited by:

    1. Carlson Lisa J. & Dacey Raymond, 2012. "A Surprising Result Encountered in Various Extensions of the Traditional Deterrence Game," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 18(1), pages 1-13, October.
    2. Raul Caruso, 2007. "Continuing Conflict and Stalemate: A note," Economics Bulletin, AccessEcon, vol. 4(17), pages 1-8.
    3. Raul Caruso, 2009. "Spesa pubblica e criminalità organizzata in Italia: evidenza empirica su dati Panel nel periodo 1997-2003," Economia & lavoro, Carocci editore, issue 1, pages 1-73.
    4. Caruso, Raul, 2007. "THE Economics of Match-Fixing," MPRA Paper 3085, University Library of Munich, Germany.
    5. Caruso, Raul, 2007. "A Tentative Model of Conflict, Appropriation and Production in a two-sector Economy," MPRA Paper 4053, University Library of Munich, Germany.
    6. Raul Caruso, 2009. "Crime and Sport Participation in Itay: Evidence from Panel Data Regional Analysis over the Period 1997-2003.\," Working Papers 0904, International Association of Sports Economists;North American Association of Sports Economists.
    7. Raul Caruso, 2011. "Relational Goods at Work! Crime and Sport Participation in Italy: Evidence from Panel Data Regional Analysis over the Period 1997–2003," Chapters,in: Contemporary Issues in Sports Economics, chapter 3 Edward Elgar Publishing.
    8. Raul Caruso, 2012. "Contest with cooperative behavior: a note," Economics Bulletin, AccessEcon, vol. 32(2), pages 1747-1754.
    9. Marco Di Domizio & Mattia Palombini, 2011. "Competitività orizzontale e verticale nel ciclismo professionistico: alcune riflessioni sul circuito pro tour," Rivista di Diritto ed Economia dello Sport, Centro di diritto e business dello Sport, vol. 6(3), pages 35-54, Febbraio.

    More about this item

    Keywords

    Conflict; Contest; Conflict management; conflict resolution; concessions; reciprocity; asymmetry in evaluation; Statistical entropy; cooperation; integrative systems; ‘guns’ and ‘talks’;

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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