Bribes v. Bombs: A Study in Coasean Warfare

Abstract:     
The use of bribes to co-opt an enemy's forces can be a more effective way to wage war than the conventional use of force: Relative to bombs, bribes can save lives and resources, and preserve civic institutions. This essay evaluates the efficacy and normative desirability of selectively substituting bribes for bombs as a means of warfare. We show how inter-country disparities in wealth, differences in military strength, the organization of the bribing and recipient forces, uncertainty about the outcome of the conflict, and communications technology can contribute to the efficacy of bribes. We discuss methods for enforcing bargains struck between opposing forces, a key problem in structuring bribes. We also examine the legal status of bribe agreements, under both international and U.S. law. While the former apparently views bribery as legitimate means of warfare, the latter poses a potentially significant obstacle by refusing on public policy grounds to enforce secret contracts made with foreign agents.

Keywords: contracts, law of war, bargaining, bribery

JEL Classifications: K13,K31,H57

Working Paper Series