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Modeling Robust Settlements to Civil War: Indivisible Stakes and Distributional Compromises

Summary of: Modeling Robust Settlements to Civil War: Indivisible Stakes and Distributional Compromises

Author(s) / Editor(s)

Wood, Elisabeth Jean
From mathematical modeling of the risk factors and uncertainty involved in a party’s continued conflict, withdrawal from conflict or commitment to a peace agreement, the distributional aspects surrounding civil war negotiations are shown to determine the robustness and range of potential settlements; the actual moves of conflicting parties in civil wars are found to reflect the dynamics of game theoretical models.

Disciplines

Economics, Political Science

Keywords

assurance game, civil society, equilibrium, prisoners dilemma

Publication Reference

Published in/by
Santa Fe Institute: Working Papers
Date
October 2003

Findings

  • Sanctioning trade of illicit commodities is recommended to reverse its negative effects on brokering a settlement.
  • Outcome uncertainty, as is common in the tumult of a civil war, results in less robust settlements, but can be counteracted with diplomatic efforts to increase confidence in the mutual-compliance settlement. Positive personal interactions between top leaders of conflicting parties and confidence inspired by mediators will facilitate finding the optimal distributional terms. Power sharing arrangements, such as decentralization of power into sub-national units and guaranteed numbers of positions for minority groups, can lessen the impact of uncertainty resulting from post-war elections.
  • Parties can limit the variation of post-war outcomes by arranging market institutions to counteract variation that might come about in post-war policy-making. For instance, a conflict between one side that represents the interests of labor and one of capital could be buffered with a constitutional focus on the rights to private property and to strike. In South Africa and El Salvador, promotion of economic interdependence between parties was encouraged by elites to safeguard their freedom of choice for investment.
  • Although the hope is that a self-enforcing cooperative strategy of withdrawal is sustainable without external enforcement, third party actors can assist by forming and monitoring institutions that promote revenue sharing. The implementation of such a plan is often difficult and can be complicated by the limiting factors of war-time benefits. As of the writing of the article the role of international actors in monitoring the distribution of revenue was being discussed in Sudanese peace negotiations.

In the absence of a decisive military advantage, self-enforcing peace settlements are still possible in a civil war. Wood explores the conditions under which parties will not necessarily renege in the absence of external enforcement, regarding settlements which distribute post-war political power and economic resources. Self-enforcing settlements rely on each party surpassing a “critical belief threshold” wherein the best response becomes to compromise for peace given the other party’s likelihood to compromise. In other words, the critical belief threshold is surpassed by altering the structure of payoffs so as to change the conflict from a Prisoner’s Dilemma to an Assurance Game. Continuing to fight can be a self-enforcing strategy, as is seen in real conflicts when war-time benefits like illicit trade are not reproducible in times of peace. The range of potential settlements is the set of distributional arrangements in which the critical belief threshold is surpassed for both parties. The robustness of a settlement refers to its ability to withstand the exogenous shocks that often occur and influence the confidence of parties in the peace process. Wood identifies a way to craft a peace settlement so that it is optimally robust, by examining where the belief thresholds for all parties intersect along potential distributions. She introduces as a variable in the conflict the perceived degree of indivisibility of stakes, as stakes in real conflicts are often not totally divisible or indivisible and the actor’s perceptions play a large role. Perceptions of indivisibility of goods reduce the range and robustness of potential settlements. Examples of partially indivisible stakes include holy sites, strategic locations and network systems, wherein control is not worth very much until the party controls a lot of it. Factions often arise within a party when there are differing opinions on the payoff of a settlement and similarly lead in the theoretical model to decreases in the range and robustness of settlements.