Alliances in the Shadow of Conflict

43 Pages Posted: 23 Jan 2013

See all articles by Changxia Ke

Changxia Ke

Lingnan (University) College, Sun Yat-sen University

Kai A. Konrad

Max Planck Institute for Tax Law and Public Finance; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); IZA Institute of Labor Economics

Florian Morath

Department of Public Finance, University of Innsbruck; Max Planck Institute for Tax Law and Public Finance

Multiple version iconThere are 3 versions of this paper

Date Written: December 14, 2012

Abstract

Victorious alliances often fight about the spoils of war. This paper presents an experiment on the determinants of whether alliances break up and fight internally after having defeated a joint enemy. First, if peaceful sharing yields an asymmetric rent distribution, this increases the likelihood of fighting. In turn, anticipation of the higher likelihood of internal fight reduces the alliance’s ability to succeed against the outside enemy. Second, the option to make non-binding declarations on non-aggression in the relationship between alliance members does not make peaceful settlement within the alliance more likely. Third, higher differences in the alliance players’ contributions to alliance effort lead to more internal conflict and more intense fighting.

Keywords: conflict, contest, alliance, endogenous internal conflict, hold-up problem, non-aggression pact, experiment

JEL Classification: D720, D740

Suggested Citation

Ke, Changxia and Konrad, Kai A. and Morath, Florian, Alliances in the Shadow of Conflict (December 14, 2012). CESifo Working Paper Series No. 4056, Available at SSRN: https://ssrn.com/abstract=2204953

Changxia Ke

Lingnan (University) College, Sun Yat-sen University ( email )

135 Xingang Xi Road
Guangzhou, Guangdong 510275
China

Kai A. Konrad (Contact Author)

Max Planck Institute for Tax Law and Public Finance ( email )

Marstallplatz 1
Munich, 80539
Germany

HOME PAGE: http://www.tax.mpg.de/en/pub/home.cfm

Centre for Economic Policy Research (CEPR)

90-98 Goswell Road
London, EC1V 7RR
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, 81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, 53072
Germany

Florian Morath

Department of Public Finance, University of Innsbruck ( email )

Max Planck Institute for Tax Law and Public Finance ( email )

Marstallplatz 1
Munich, 80539
Germany

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