As before, the two groups incur equal levels of campaign expenses but are characterised by different probabilities of success equal to their respective election campaign effectiveness. Comparison of (5) and (6) shows that we cannot say a priori whether fighting a violent conflict is more expensive than fighting an election, for this depends on the relative effectiveness parameters and and the destructive effect of the conflict   , which tends to decrease the size of resources committed to winning the conflict. Substituting into (4.A) and (4.B), we obtain corresponding equilibrium net expected payoffs as (6.A) VAG = [+k(1–2)]R (6.B) VBG = A peaceful political arrangement will prevail if both rivals are better off under that arrangement, that is, when and simultaneously AGW BGW VAG–VAW >0 Conflict arises if at least one of the two adversaries expects a higher payoff by >0. engaging in a violent fight, that is, if (AGW<0, or (AGW>0, or BGW>0), BGW<0), (AGW<0, Upon substitution, we find BGW<0). (7.A) AGW (1–)]R = [+k(1–2) – + (7.B) BGW = {(1–) k[2(2–)–1] – (1–)(1–)}R With the coefficients ,  and  exogenously given, the size of the power-sharing parameter emerges as a crucial variable in the decision to accept a peace settlement. k Following Garfinkel and Skaperdas (2007), it is assumed that the rival groups agree to divide the gains that are realised when a settlement is agreed according to the formula, which postulates that each side obtains the same gain by avoiding war. Formally, this division rule implies that AGW= BGW. Substituting from the sets of equations (7), and solving with respect to we obtain the k, equilibrium size of k . (8) The latter is defined for values such that Equation (8) shows that the power-sharing ½. parameter depends on the fighting and electoral campaigning effectiveness of the rival groups and the destructive effect of war. More specifically, two components are
As before, the two groups incur equal levels of campaign expenses but are characterised by different probabilities of success equal to their respective election campaign effectiveness. Comparison of (5) and (6) shows that we cannot say a priori whether fighting a violent conflict is more expensive than fighting an election, for this depends on the relative effectiveness parameters  and  and the destructive effect of the conflict , which tends to decrease the size of resources committed to winning the conflict. Substituting into (4.A) and (4.B), we obtain corresponding equilibrium net expected payoffs as VAG = [+k(1–2)]R (6.A) VBG = (6.B) A peaceful political arrangement will prevail if both rivals are better off under that arrangement, that is, when AGW VAG–VAW >0 and simultaneously BGW >0. Conflict arises if at least one of the two adversaries expects a higher payoff by engaging in a violent fight, that is, if (AGW<0, BGW>0), or (AGW>0, BGW<0), or (AGW<0, BGW<0). Upon substitution, we find AGW = [+k(1–2) – (1–)]R (7.A) BGW = {(1–) + k[2(2–)–1] – (1–)(1–)}R (7.B) With the coefficients ,  and  exogenously given, the size of the power-sharing parameter k emerges as a crucial variable in the decision to accept a peace settlement. Following Garfinkel and Skaperdas (2007), it is assumed that the rival groups agree to divide the gains that are realised when a settlement is agreed according to the formula, which postulates that each side obtains the same gain by avoiding war. Formally, this division rule implies that AGW= BGW. Substituting from the sets of equations (7), and solving with respect to k, we obtain the equilibrium size of k . (8) The latter is defined for values such that ½. Equation (8) shows that the power-sharing parameter depends on the fighting and electoral campaigning effectiveness of the rival groups and the destructive effect of war. More specifically, two components are
GT-PEPowerSharing.docx