The Missile and the Toll: Two-Way Flow Through the Strait of Hormuz

Bernhard K Meister

Papers from arXiv.org

Abstract: Tolls for safe passage and attacks on shipping are usually treated as mutually exclusive: either ships pay or attacks happen. We argue they are complementary. In a Stackelberg escalation game for the Strait of Hormuz, the enforcer chooses an attack intensity and a toll schedule; the response is to pay, cross exposed, wait, reroute, or exit. Attacks create the willingness to pay; tolls harvest it. The model predicts asymmetry across trade forms: a toll where the cargo owner can pay and the vessel owner will consent, and none where either fails. Any such payment is clandestine, but the model's implications are testable against freight rates, insurance premia, and incident reports.

Date: 2026-10
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