All-Pay Auctions as Models for Trade Wars and Military Annexation
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arXiv
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| Autores principales: | , |
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| Formato: | Preprint |
| Publicado: |
2020
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| _version_ | 1866915598939717632 |
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| author | Kang, Benjamin Unwin, James |
| author_facet | Kang, Benjamin Unwin, James |
| contents | We explore an application of all-pay auctions to model trade wars and territorial annexation. Specifically, in the model we consider the expected resource, production, and aggressive (military/tariff) power are public information, but actual resource levels are private knowledge. We consider the resource transfer at the end of such a competition which deprives the weaker country of some fraction of its original resources. In particular, we derive the quasi-equilibria strategies for two country conflicts under different scenarios. This work is relevant for the ongoing US-China trade war, and the recent Russian capture of Crimea, as well as historical and future conflicts. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2002_03492 |
| institution | arXiv |
| publishDate | 2020 |
| record_format | arxiv |
| spellingShingle | All-Pay Auctions as Models for Trade Wars and Military Annexation Kang, Benjamin Unwin, James Theoretical Economics We explore an application of all-pay auctions to model trade wars and territorial annexation. Specifically, in the model we consider the expected resource, production, and aggressive (military/tariff) power are public information, but actual resource levels are private knowledge. We consider the resource transfer at the end of such a competition which deprives the weaker country of some fraction of its original resources. In particular, we derive the quasi-equilibria strategies for two country conflicts under different scenarios. This work is relevant for the ongoing US-China trade war, and the recent Russian capture of Crimea, as well as historical and future conflicts. |
| title | All-Pay Auctions as Models for Trade Wars and Military Annexation |
| topic | Theoretical Economics |
| url | https://arxiv.org/abs/2002.03492 |