Question

In: Economics

Which of the following is an explanation, using bargaining theory, of why the United States went...

Which of the following is an explanation, using bargaining theory, of why the United States went to war with Iraq in 2003?

Information deficiencies precluded a negotiated outcome. Saddam Hussein was paranoid. George W. Bush was driven by revenge for Iraq's attempt to assassinate his father. No agreements could have been negotiated, so war was the only option.

Solutions

Expert Solution

Correct answer is a: Information deficiencies precluded a negotiated outcome.

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The framework for this answer is provided by the Bargaining Model of War (BMoW)

James Fearson has proposed three conditions such fulfilment of one or more of these conditions provides the sufficient condition for feasibility of war in the bargaining model:

i) Uncertainty: Underestimation or overestimation of probabilities and associated payoffs

ii) Indivisibility of a good: if the actors believe a commodity or resource can't be shared

iii) Commitment Problems: an actor has a difficulty to commit to not use military strength in the future.
^ bolded because this is the relevant point here

Bargaining theory implies and the available evidence confirms that the war was driven primarily by the inability of Iraq to commit credibly not to develop Weapons of Mass Destruction (WMD) and exacerbated by private information held by Saddam Hussein about his military strategies and capabilities and his incentives not to reveal this information.

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