This paper studies the strategic role of extremism within a two-country multi-stage game and shows that, in general, an equilibrium exists in which extremism is used by both rivals. We show that often changes in the environment affect the two countries differently. Specifically, as a country becomes wealthier, more powerful, or more democratic, its level of extremism decreases, but at the same time, its rival’s level of extremism increases. Similarly, higher stakes in the conflict tend to increase the level of extremism in the relatively poorer, weaker, and less democratic country, but decrease the level of extremism in the other country. On the other hand, higher stakes in a conflict between similar countries and greater destructiveness vis-à-vis the contested asset will increase the levels of extremism in both countries. Since changes in the environment may affect the levels of extremism in the two countries in opposite ways, we calculate the probability of an extremist destructive episode as a possible measure of the “aggregate” level of extremism in the conflict. We find that the aggregate level of extremism decreases with wealth, power, and degree of democracy, but increases with the stakes in the conflict and with better access to destructive technology. Finally, we use the model to examine levels of extremism within the context of the Israeli–Palestinian conflict.
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