The Survival and Demise of the State: A Dynamic Theory of Secession

Sabine Flamand (), Massimo Morelli (), Dominic Rohner and Joan Esteban ()

No 1028, Working Papers from Barcelona School of Economics

Abstract: This paper analizes the repeated interaction between groups in a country as a repeated Stackelberg game, where conflict and secession can occur on the equilibrium path owing to commitment problems. If a group out of power is small enough and its contribution to total surplus not too large, then the group in power can always maintain peace with an acceptable offer of surplus sharing for every period. When there is a mismatch between the relative size and the relative surplus contribution of the minority group, conflict can occur. While in the static model secession can occur only as a peaceful outcome, in the infinite horizon game with high discount factor secession may result following costly conflict. We discuss our full characterization of equilibrium outcomes in the light of the available empirical evidence.

Keywords: conflict; secessions; repeated Stackelberg game (search for similar items in EconPapers)
JEL-codes: C7 D74 (search for similar items in EconPapers)
Date: 2018-03
New Economics Papers: this item is included in nep-cdm, nep-gth and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:1028

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