Stergios Skaperdas

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In many situations the individuals who can generate some output must enter a contest for appropriating this output. This paper analyses the investment incentives of such agents and the role of incumbency advantages in the contest. Depending on the advantages, an increase in the productivity of the investment can decrease or increase the amount of(More)
In this chapter, we review the recent literature on conflict and appropriation. Allowing for the possibility of conflict, which amounts to recognizing the possibility that property rights are not perfectly and costlessly enforced, represents a significant departure from the traditional paradigm of economics. The research we emphasize, however, takes an(More)
In many economic environments agents make costly and irreversible investments (in ``guns'') that may enhance their respective threat payoffs but also shrink the utility possibilities set. In such settings, with variable threats and a variable utility possibilities set, it becomes possible to rank different bargaining solutions in terms of efficiency. We(More)
Sovereign states arm to defend real or hypothetical interests, presumably because they cannot engage in complete, long-term contracting that would prevent such arming. International trade, therefore, takes place within an essentially anarchic context, and we can expect trade regimes and security policies to be related. Indeed, many embargoes, sanctions, and(More)
Acluster of arguments referred to as ‘‘cooperation theory’’ or ‘‘neoliberal institutionalism’’ stands as one of the more interesting and important developments in international relations theory in the last Ž fteen years.1 Focused on the problems of whether and how states might cooperate for mutual advantage despite the absence of supranational government(More)
Conflict and war are typically viewed as the outcome of misperceptions, incomplete information, or even irrationality. We show that it can be otherwise. Despite the short-run incentives to settle disputes peacefully, there can be long-term, compounding rewards to going to war when doing better relative to one’s opponent today implies doing better tomorrow.(More)
Organized crime emerges out of the power vaccuum that is created by the absence of state enforcement, and which can have many sources: geographic, social, and ethnic distance, prohibition, or simply collapse of state institutions. Mafias and gangs are hierarchically organized and can be thought of as providing primitive state functions, with economic costs(More)
We examine a stark setting in which security or protection can be provided by self-governing groups or by for-profit entrepreneurs (kings, kleptocrats, or mafia dons). Though selfgovernance is best for the population, it faces problems of long-term viability. Typically, in providing security the equilibrium market structure involves competing lords, a(More)
Decision makers must balance between two classes of economic activities: production and confl\ict. Analogous to the familiar technology of production and exchange is the technology of conflict and struggle, applicable not only to military combat but also in domains such as redistributive politics, strikes and lockouts, litigation, and crime. The conflict(More)