Intimidation: Linking Negotiation and Conflict

Sambuddha Ghosh (), Gabriele Gratton and Caixia Shen ()
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Sambuddha Ghosh: Department of Economics, Boston university
Caixia Shen: School of International Business Administration, Shanghai University of Finance and Economics

No 2015-07A, Discussion Papers from School of Economics, The University of New South Wales

Abstract: A Challenger demands a resource from Defender. In each period, Challenger chooses whether to attack; if attacked, Defender chooses whether to concede the resource forever. Each player might be committed to fighting until victory. Before conflict begins, Defender can make finitely many offers; conflict begins if Challenger rejects all offers. In equilibrium, all offers except the last are unacceptable. Negotiation cannot eliminate conflict because a larger offer makes conflict increasingly attractive for Challenger. If negotiation fails, prolonged conflict can happen in equilibrium, even when uncertainty is vanishingly small. We provide comparative statics regarding the probability and length of conflict.

Keywords: Intimidation; reputation; terrorism; negotiation; brinkmanship; costly war-of-attrition (search for similar items in EconPapers)
JEL-codes: D74 D82 (search for similar items in EconPapers)
Pages: 49 pages
Date: 2015-04
New Economics Papers: this item is included in nep-mic
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http://research.economics.unsw.edu.au/RePEc/papers/2015-07A.pdf (application/pdf)

Related works:
Journal Article: INTIMIDATION: LINKING NEGOTIATION AND CONFLICT (2019)
Working Paper: Intimidation: Linking Negotiation and Conflict (2018)
Working Paper: Intimidation: Linking Negotiation and Conflict (2015)
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