The Strategy of Manipulating Conflict

Author:

Baliga Sandeep1,Sjöström Tomas2

Affiliation:

1. Kellogg School of Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208.

2. Department of Economics, Rutgers University, New Brunswick, NJ 08901.

Abstract

Two players choose hawkish or dovish actions in a conflict game with incomplete information. An “extremist,” who can either be a hawk or a dove, attempts to manipulate decision making. If actions are strategic complements, a hawkish extremist increases the likelihood of conflict, and reduces welfare, by sending a public message which triggers hawkish behavior from both players. If actions are strategic substitutes, a dovish extremist instead sends a public message which causes one player to become more dovish and the other more hawkish. A hawkish (dovish) extremist is unable to manipulate decision making if actions are strategic substitutes (complements). (JEL D74, D82)

Publisher

American Economic Association

Subject

Economics and Econometrics

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