JMP: "Do States Screen or Signal?"

How will negotiations unfold when countries have to invest costly effort in diplomacy? Modeling negotiations as a war of attrition, I demonstrate that when diplomacy requires effort, resolved states are less likely to settle disputes peacefully. Resolved states have less to lose by going to war and so devote less time and resources to negotiations. Instead resolved states will go to war, forgoing the opportunity that their rival will concede peacefully. Knowing that a resolved rival might choose to go to war abruptly, unresolved states prefer to concede before fighting breaks out. States can therefore learn about their rival's resolve through a screening process, gleaning information from their rival's decision whether to continue negotiating or not. These results present a strong challenge to the literature on costly signaling by (1) undermining the premise that resolved types invest more in diplomacy and (2) presenting an alternative method of learning.     

Read the paper here.  

Learn more about Noam here.