Bargaining Model Flashcards
(43 cards)
What is bargaining?
Bargaining is the process by which two rational actors who pursue their self-interests attempt to reach an agreement about alternative ways to divide a given (and known) surplus, earned from their cooperation
What is the most prominent bargaining model?
The Rubinstein model
- Ariel Rubinstein
- He solved it in 1982
- Before his insight, bargaining procedure was thought as a black box
What are other terms for the Bargaining Theory (BT) of war?
- Bargaining model of war
- Rationalist explanations of war
What is the origin of bargaining theory of war?
- Carl von Clausewitz
- Book On War (Vom Kriege): importance of bargaining in politics
What does Carl von Clausewitz say about war?
The political object is the goal, war is the means of reaching it, and means can never be considered in isolation from their purpose
- War for its own sake has no value
- One would never pursue it without the accomplishment of some larger political aim
What is Thomas Shelling known for?
- Thomas Shelling (1921-2016) was one of the first modern social scientists (economist) frame conflict/war as a bargaining process, using mostly informal discussion and early noncooperative games
- He won the Nobel Prize in Economics in 2005
- He is mostly known for his ideas of credible commitment, focal points and for applying game theory to the Cold War
What did Shelling posit about conflict?
- Thomas Shelling. 1960. The Strategy of Conflict.
– Most conflict situations are essentially bargaining situations
How did Shelling affect the understanding of bargaining/settlement
- The notion of bargaining/settlement is now at the centre of how we understand war
– Previously one assumed that wars end because of unilateral capitulation or conquest - “The link between diplomatic crisis and the outbreak of war seems central to the understanding of war”
What had happened to the Bargaining Theory of War by the 1980s
- By the 1980s, the BT of War was increasingly expressed in formal term
– A formal model is a precise statement of components to be used and the relationships among them
– Formal models are usually stated via mathematics, often equations - During this time, more and more scholars claimed that war is a deliberate political act
– Which is at odds with many of the previous theories
James Fearon facts
- James D. Fearon. 1995. Rationalist Explanations for War.
- Fearon is among the most influential IR scholars of the last twenty years
- He provided not only the formative basis, a coherent intellectual framework but also articulated its core puzzle
– “War is costly and risky, so rational states should have incentives to locate negotiated settlements that all would prefer to the gamble of war”
Underlying assumptions of Bargaining Theory of War
- States are rational
– They try to maximize their expected utility - War is costly for all parties
– Fighting is costly because it kills people and destroys assets
– Fighting is costly because it diverts resources
– Difference with other models on war: they assume that war can have positive utility, ie. provide benefits to the victor (and greater than the costs suffered on the battlefield)
– In bargaining model: fighting in itself is costly belligerents always suffer some negative utility
What is Fearon’s conclusion on war?
War is inefficient
- War is always inefficient ex post - both states would have been better off if they achieve a resolution without suffering the costs
What are the five existing explanations as to what prevents states from reaching ex ante agreements that avoid the costs they know will be paid if they go to war?
- Anarchy
- Preventive war
- Positive expected utility
- Rational miscalculations due to lack of information
- Disagreement about relative power
What does Fearon show about war?
Fearon shows that there is always a set of negotiated settlements that both actors prefer to going to war
What is the relationship between Bargaining Theory of War and neorealism
- Very strong relationship between BT of War and neorealism
- “If no rationalist explanation for war is theoretically and empirically tenable, then neither is neorealism”
– If rationalist explanations of war do not hold then war is caused by human nature or individual states rather than international systems (which goes against neorealist views) - Fearon argues that existing neorealist explanations (such as anarchy, etc.) are not able to fully explain the occurrence of war (or lack thereof)
Why, according to Fearon, does Anarchy fall short as an explanation for war?
Anarchy: War occurs because no one can stop it
- It increases fear and opportunity for conflict, but how does a lack of central authority prevent negotiations?
Why, according to Fearon, does Positive Expected Utility fall short as an explanation for war?
Positive expected utility: War is a better option than any bargain
- Informal versions fail to address the question of how or under what conditions it can be possible for two states to prefer costly option of war over any settlement
Why, according to Fearon, does Preventative War fall short as an explanation for war?
Preventative war: Declining powers attack rising powers to prevent future attack
- Arguments do not consider whether the states could construct a bargain that would leave both parties better off
Why, according to Fearon, does Rational miscalculation due to lack of information fall short as an explanation for war?
Why can states not avoid miscalculations of a potential opponent’s willingness to fight?
Why, according to Fearon, does Disagreement about relative power fall short as an explanation for war?
- Disagreements about relative strength can eliminate ex ante bargaining range
- Even if this is the case, both sides gain by sharing information, which can help to reveal bargain that both prefer over war
What is the connecting weakness that Anarchy, Positive Expected Utility, and Preventative War all have as explanations for war?
All three explanations do not explain why states use force when it is not in their interest, ie. there are outcomes that both prefer to fighting
What is the strength that rational miscalculation due to lack of information and disagreement about relative power have for explaining war?
They address the question (why war?) up to a point: rational leaders may miss superior negotiated settlement when lack of information leads to miscalculate relative power or resolve
What do rational miscalculation due to lack of information and disagreement about relative power fail to explain?
- They do not explain what prevents rational leaders from using diplomacy to avoid such miscalculations
- ie. they do not go far enough!
What are the two steps that need to be taken to tackle the lack of resolutions possible in bargaining theory of war?
- (1) We need to prove that there always exist a bargaining solution that is better for both states than going to war
– In other words, we need to prove that bargaining agreement > war - (2) If such a solution exists; how can we explain the fact that states still go to war?
