Why Can’t We Be Friends? - Entitlements and the Costs of Conflict
Erik O. Kimbrough
Simon Fraser University
Roman M. Sheremeta
November 22, 2013
We design an experiment to explore the impact of earned entitlements on the frequency and intensity of conflicts in a two-stage conflict game with side-payments. In this game, residents (Proposers) make side-payment offers and contestants (Responders) decide whether to accept the offers and whether to engage in a conflict. When subjects earn their roles, conflicts are 44% more likely to be avoided than when roles are assigned randomly. Earned rights impact behavior in three important ways: residents who have earned their position persistently offer larger side-payments; larger offers lead to a lower probability of conflict, but residents whose offers do not lead to conflict resolution respond spitefully and exhibit greater conflict expenditure. Hence, with earned rights, the positive welfare effects of reduced conflict frequency are offset by higher conflict intensity.
Number of Pages in PDF File: 32
Keywords: contests, conflict resolution, side-payments, entitlements, experiments
JEL Classification: C72, C91, D72working papers series
Date posted: September 5, 2012 ; Last revised: November 26, 2013
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