'Cheap Talk' Diplomacy, Voluntary Negotiations, and Variable Bargaining Power

51 Pages Posted: 1 Apr 2011

See all articles by Kristopher Ramsay

Kristopher Ramsay

Princeton University - Department of Political Science

Date Written: March 31, 2011


It is well known that during a crisis unitary rational states have an incentive to misrepresent their true resolve and willingness to go to war. This theoretical result has been taken to imply that diplomacy, interpreted as pre-bargaining communication, can have no effect on the way crises play out. This paper shows an intuitive way that diplomatic cheap talk can matter in a single crisis between countries, especially when the bargaining game has multiple equilibria. In particular, if after 'diplomacy' states can choose to either fight a war directly or bargain in hopes of reaching a peaceful settlement, then it is possible to find an equilibrium where diplomacy influence whether there is war or peace. Importantly the cheap talk diplomacy does three things the standard model says it cannot: it coordinates actions, it reveals information, and it changes the ex ante probability of war. This result demonstrates an easy way of reconciling the discrepancy between the obvious empirical observation that diplomacy often does influence the path of a crisis and the rationalist model of war.

Keywords: Crisis bargaining, dilomacy, game theory

JEL Classification: C78, D74

Suggested Citation

Ramsay, Kristopher, 'Cheap Talk' Diplomacy, Voluntary Negotiations, and Variable Bargaining Power (March 31, 2011). Available at SSRN: https://ssrn.com/abstract=1800074 or http://dx.doi.org/10.2139/ssrn.1800074

Kristopher Ramsay (Contact Author)

Princeton University - Department of Political Science ( email )

Fisher Hall
Princeton, NJ 08544-1012
United States

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