Working Paper: CEPR ID: DP6741
Authors: Kai A. Konrad; Dan Kovenock
Abstract: The formation of an alliance in conflict situations is known to suffer from a collective action problem and from the potential of internal conflict. We show that budget constraints of an intermediate size can overcome this strong disadvantage and explain the formation of alliances.
Keywords: alliance formation puzzle; budget constraints; military conflict
JEL Codes: D72; D74
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| budget constraints (H60) | reduction in noncooperative behavior (C71) |
| reduction in noncooperative behavior (C71) | alliance formation (D74) |
| budget constraints (H60) | alliance formation (D74) |
| budget constraints (H60) | likelihood of successful alliance formation (D74) |
| alliance formation (D74) | increased competitive strength (L19) |
| budget constraints of intermediate size (D20) | likelihood of forming alliances (D74) |