Modeling Deterrence by Denial and by Punishment

We explore a defender's prewar allocation of military resources between denial and punishment strategies for deterrence. While denial disproportionately raises the probability to countervail aggression by disrupting military forces ("guns"), punishment proportionately raises costs on the aggressor by damaging civilian values ("butter"). Because these countervailing and deterrence effects are so divergent, the deployment that minimizes the risk of war can vary, depending on the defender's military capacity relative to the aggressor's. Namely, inferior parties resort only to punishment (e.g., post-Cold War North Korea), competitive parties concentrate solely on denial (e.g., Germany, Italy, and Japan), and superior parties develop both denial and punishment capabilities (e.g., Permanent Five).