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Resources for conflict: Constraint or wealth?

Kyung Hwan Baik, Subhashish M. Chowdhury and Abhijit Ramalingam ()
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Subhashish M. Chowdhury: University of East Anglia

No 15-03, Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) from School of Economics, University of East Anglia, Norwich, UK.

Abstract: We investigate the effects of the availability of resources that can be expended in conflict on conflict intensity. We run a between-subjects Tullock contest in which we vary the contest budget from Low to Medium to High, while keeping the Nash equilibrium bid the same. We find an 'inverted U-shaped' relationship between resource availability and conflict intensity. While standard error correction models can explain the first part of the relationship by attributing resources as constraint, they do not apply in the latter part. We further run a Wealth treatment in which the budget remains Medium, but a fixed payment independent of the contest outcome is provided. The level of conflict in the Wealth and the High treatment are not different. We conclude that the resources for conflict can have both a constraint as well as a wealth effect. When initial resources are scarce, they act as a constraint. As more resources become available, the constraint loosens up and conflict intensity increases. However, when resources are abundant, they are viewed as wealth and conflict intensity decreases.

Keywords: conflict; experiment; wealth effect; resource constraint (search for similar items in EconPapers)
JEL-codes: C72 C91 D72 D74 (search for similar items in EconPapers)
Date: 2015-03
New Economics Papers: this item is included in nep-ene and nep-exp
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Working Paper: Resources for Conflict: Constraint or Wealth? (2014) Downloads
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