Uncertainty about Relative Power and War

The traditional and formal literatures in international relations have placed uncertainty at the center of their explanations for war. The formal literature has largely focused on uncertainty regarding the costs of war while the traditional literature focuses on uncertainty about relative power. In this paper we analyze a class of formal models of conflict where players choose between fighting and a negotiated settlement, players are uncertain about their likelihood of winning a war, and where each side has private information about the probability of winning. Unlike the few existing formal papers modeling uncertainty about relative power, we find that there are different and important strategic incentives that arise in this interdependent values setting. First, we find that in these formal models of conflict, mutual optimism regarding the players’ prospects in war and the occurrence of war are simply coincidental. That is, mutual optimism is neither necessary nor minimally sufficient for war in equilibrium. Second, we find that strategic incentives in the presence of uncertainty about relative power leads decision-makers to choose war even when both sides’ private information tells them that the expected outcome of war is worse than opting for the efficient settlement. That is, there is rational war with mutual pessimism. ∗ Associate Professor, Department of Political Science, 109E Harkness Hall, University of Rochester, Rochester, NY 14627. phone: 585.275.5810, email: [email protected]. Assistant Professor, Department of Politics, 033 Corwin Hall, Princeton University, Princeton, NJ 08544. phone: 609.258.2960, email: [email protected].