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A game theoretic approach of war with financial influences

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  • Roman, Mihai Daniel

Abstract

During history, an aggressive country seeks to force non-aggressive countries to made many concessions based on military force. In our paper we discuss the situation that one aggressive country is dissatisfied with its current position and try to obtain more concessions from a rival country. To analyze this situation we use a game theory dynamic model in complete and incomplete information. We analyze the countries behavior depending especially on aggressive or non-aggressive strategies and also on battle power. In this context we found conditions to obtain separating and pooling equilibriums for dynamic games in incomplete information. Main result shows that countries behavior depends especially on war costs and on country military power. There are many applications of these types of models, like in Israel - Palestinian war, recent Russian- Georgian conflict or US defense policy.

Suggested Citation

  • Roman, Mihai Daniel, 2010. "A game theoretic approach of war with financial influences," MPRA Paper 38389, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:38389
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    References listed on IDEAS

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    More about this item

    Keywords

    War; Negotiation Game; Repeated Game; Bargaining; Folk theorem; Bounded Rationality;

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

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