Working Papers
The paper studies a two-stage conflict game between two groups of players. In the first stage, each player independently of all other players chooses how much monetary effort to spend defending himself. In the second stage, each player decides how much effort to spend attacking players in the other group. Players can use their resources differently, and their effectiveness varies for the same dollar spent. The chance of winning a battle against a player in the other group depends on the effectiveness of the attackers and the defender. It increases with higher attack levels from other players in their group and decreases with the defense level of the attacked player. The outcome of this strategic conflict ranges from full-scale war to complete peace. A numerical measure of efficacy is introduced. In the case of linear effort costs, when attacking a specific player, only the most efficacious attacker expends effort on the attack, while less-efficacious allies free-ride on him. Using convex costs of effort mitigates the free-rider problem. The paper draws parallels with the ongoing Russo-Ukrainian War and the pharmaceutical industry's battles between generic and brand-name drugs.
Work in Progress
Strategic Conflict Between Two Groups of Players: The Quadratic-Cost Extension
This project extends the model presented in my job market paper titled "Strategic Conflict Between Two Groups of Players: The Non-Cooperative Approach" to allow for strictly convex cost functions. Convex costs apply to more complex systems where action efficacy is diminished—often due to lengthy command chains and escalating costs with increased effort, as seen in military operations. Unlike the linear-cost model, the free-rider phenomenon is considerably mitigated with strictly convex costs, allowing multiple countries to band together for attacks. Specific examples using quadratic costs are currently being worked out, but the aim is to develop a more general, yet tractable, model.
Strategic Conflict Between Two Groups of Players: The Cooperative Approach
This project investigates a two-stage conflict game between two groups of players. In the first stage, each player determines the monetary effort to allocate towards defending themselves and their allies. In the second stage, each player decide how much effort to invest in attacking members of the opposing group. The cooperative version of the game allows players to form coalitions. The study aims to equitably distribute payoffs within each coalition by employing the Shapley value to address potential subsidization issues. By endogenously determining exchange rates, representing relative bargaining power or interpersonal utility weights, this project seeks to establish optimal weights based on each player's contribution to the total monetary effort expended by the coalition.