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Fight or Flight : Endogenous Timing in Conflicts

Author

Listed:
  • van Leeuwen, Boris

    (Tilburg University, Center For Economic Research)

  • Offerman, Theo
  • van de Ven, Jeroen

Abstract

We study a dynamic game in which players compete for a prize. In a waiting game with two-sided private information about strength levels, players choose between fighting, fleeing, or waiting. Players earn a “deterrence value” on top of the prize if their opponent escapes without a battle. We show that this value is a key determinant of the type of equilibrium. For intermediate values, sorting takes place with weaker and more loss averse players fleeing before others fight. Time then helps to reduce battles. In an experiment, we find support for the key theoretical predictions, and document suboptimal predatory fighting.

Suggested Citation

  • van Leeuwen, Boris & Offerman, Theo & van de Ven, Jeroen, 2018. "Fight or Flight : Endogenous Timing in Conflicts," Discussion Paper 2018-052, Tilburg University, Center for Economic Research.
  • Handle: RePEc:tiu:tiucen:ed32885c-3183-4eff-a0ff-7307d0bb0cf8
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    fight-or-flight; contest; sorting; loss aversion; theory; experiment;

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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