Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/219260 
Authors: 
Year of Publication: 
2019
Citation: 
[Journal:] Games [ISSN:] 2073-4336 [Volume:] 10 [Issue:] 4 [Publisher:] MDPI [Place:] Basel [Year:] 2019 [Pages:] 1-14
Publisher: 
MDPI, Basel
Abstract: 
One of the most widely accepted explanations for why wars occur despite its Pareto-suboptimality is mutual optimism: if both sides expect to gain a lot by fighting, war becomes inevitable. The literature on mutual optimism typically assumes mutually optimistic beliefs and shows that, under such an assumption, war may occur despite its Pareto-suboptimality. In a war-peace model, we show that, if players neglect the correlation between other players' actions and their types-a well-established concept in economics-then players' expected payoffs from war increase relative to conventional informational sophistication predictions, hence providing a microfoundation of mutual optimism.
Subjects: 
correlation neglect
incentives to go to war
information
mutual optimism
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Creative Commons License: 
cc-by Logo
Document Type: 
Article
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