Conflict in the Shadow of Conflict

Se Hoon Bang and Jae Soo Kim

KDI Journal of Economic Policy, 2016, vol. 38, issue 4, 95-114

Abstract: We study how an advantage given to an interim winner in sequential conflicts characterizes dynamic competition between players and influences their payoffs. As the intensity of competition during each period is negatively correlated, perfect security is not necessarily desirable for contending parties. We present results which are widely applicable to various types of dynamic competition, where competition in each period is linked to the interim winner's relative advantage. Policy implications are also discussed in a variety of areas, and several extensions are explored.

Keywords: Sequential Conflicts; AllPay Auctions; Sequential Innovations; Arms Race (search for similar items in EconPapers)
JEL-codes: D44 D74 O31 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:kdijep:200800

DOI: 10.23895/kdijep.2016.38.4.95

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