Balance of Power and the Propensity of Conflict

54 Pages Posted: 27 Jul 2014 Last revised: 8 Sep 2015

See all articles by Luisa Herbst

Luisa Herbst

Max Planck Institute for Tax Law and Public Finance

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

Date Written: July 25, 2014

Abstract

We study the role of an imbalance in fighting strengths when players bargain in the shadow of conflict. Our experimental results suggest: In a simple bargaining game with an exogenous mediation proposal, the likelihood of conflict is independent of the balance of power. If bargaining involves endogenous demand choices, however, the likelihood of conflict is higher if power is more imbalanced. Even though endogenous bargaining outcomes reflect the players unequal fighting strengths, strategic uncertainty causes outcomes to be most efficient when power is balanced. In turn, the importance of exogenous mediation proposals depends on the balance of power.

Keywords: Conflict, Balance of Power, Contest, Bargaining, Nash Demand Game, Conflict Resolution, Asymmetries, Experiment

JEL Classification: C78, C91, D72, D74

Suggested Citation

Herbst, Luisa and Konrad, Kai A. and Morath, Florian, Balance of Power and the Propensity of Conflict (July 25, 2014). Working Paper of the Max Planck Institute for Tax Law and Public Finance No. 2014-13, Available at SSRN: https://ssrn.com/abstract=2471532 or http://dx.doi.org/10.2139/ssrn.2471532

Luisa Herbst (Contact Author)

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

Marstallplatz 1
Munich, 80539
Germany

Kai A. Konrad

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

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
73
Abstract Views
1,020
rank
347,674
PlumX Metrics