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Peace and War in Territorial Disputes

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  • Herschel I. Grossman

Abstract

Why do sovereign states sometimes fail to settle territorial disputes peacefully? Also, why do even peaceful settlements of territorial disputes rarely call for the resulting border to be unfortified? This paper explores a class of answers to these questions that is based on the following premise: States can settle a territorial dispute peacefully only if (1) their payoffs from a peaceful settlement are larger than their expected payoffs from a default to war, and (2) their promises not to attack are credible. This premise directs the analysis to such factors as the advantage of attacking over both defending and counterattacking, the divisibility of the contested territory, the possibility of recurring war, the depreciation or obsolescence of fortifications, and inequality in the effectiveness of mobilized resources.

Suggested Citation

  • Herschel I. Grossman, 2004. "Peace and War in Territorial Disputes," NBER Working Papers 10601, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:10601
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    Cited by:

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    3. Gangopadhyay Partha & Elkanj Nasser, 2009. "Politics of Defence Spending and Endogenous Inequality," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 15(1), pages 27-49, May.
    4. Yang-Ming Chang & Shane Sanders, 2009. "Raising The Cost Of Rebellion: The Role Of Third-Party Intervention In Intrastate Conflict," Defence and Peace Economics, Taylor & Francis Journals, vol. 20(3), pages 149-169.
    5. Herschel I. Grossman, 2013. "Choosing Between Peace and War," Annals of Economics and Finance, Society for AEF, vol. 14(2), pages 765-783, November.
    6. Yang-Ming Chang & Zijun Luo, 2013. "War Or Settlement: An Economic Analysis Of Conflcit With Endogenous And Increasing Destruction," Defence and Peace Economics, Taylor & Francis Journals, vol. 24(1), pages 23-46, February.
    7. Leonardo Raffo López, 2007. "El modelo de Skaperdas y Syropoulos," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 9(17), pages 153-181, July-Dece.
    8. Chang Yang-Ming & Sanders Shane D., 2009. "Corruption on the Court: The Causes and Social Consequences of Point-Shaving in NCAA Basketball," Review of Law & Economics, De Gruyter, vol. 5(1), pages 269-291, May.
    9. Chang, Yang-Ming & Potter, Joel & Sanders, Shane, 2007. "War and peace: Third-party intervention in conflict," European Journal of Political Economy, Elsevier, vol. 23(4), pages 954-974, December.
    10. Ivan Lopez Cruz & Gustavo Torrens, 2019. "The paradox of power revisited: internal and external conflict," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 68(2), pages 421-460, September.
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    12. Yang-Ming Chang, 2009. "Strategic altruistic transfers and rent seeking within the family," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(4), pages 1081-1098, October.

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    More about this item

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War

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