Uncertainty in Conflicts

36 Pages Posted: 9 Nov 2010

Date Written: October 4, 2010


This paper theoretically assesses the role that uncertainty plays in the intensity of conflicts. The standard two-player rent-seeking contest model (Tullock, 1980) is extended to allow for privately known subjective values of the prize. The conflict is modeled as a Bayesian game on which each player’s valuation is drawn independently from arbitrary distributions. We find sufficient conditions for when first-order and second-order stochastic refinements in the distributions cause predictable movements in the conflict’s dissipation. We focus on arbitrary contest success functions and arbitrary independent distributions for each player, allowing us to extend our analysis beyond the case of symmetric equilibria.

Keywords: Conflict, Uncertainty, Monotone Comparative Statics, Bayesian Games

JEL Classification: C70, C72, D74, D80

Suggested Citation

Prada Sarmiento, Juan David, Uncertainty in Conflicts (October 4, 2010). Documento CEDE No. 2010-29, Available at SSRN: https://ssrn.com/abstract=1705531 or http://dx.doi.org/10.2139/ssrn.1705531

Juan David Prada Sarmiento (Contact Author)

Central Bank of Colombia ( email )

Carrera 7 #14-78

HOME PAGE: http://www.banrep.gov.co

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