State Sponsorship of Terror in Territorial Conflicts: A Game-Theoretic Approach Open Access

Baby Kumar, Madhumitha (Spring 2020)

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With the increasing number of disputed territories and the changing dynamics of conflicts, it is pertinent to look for patterns and find solutions that can help end modern-day conflicts and protect civilians from violence and death. Terrorist groups have been influencing today’s conflicts and some are more efficient than others due to sponsorship from their supporting states in the form of power, money, and weapons. This paper addresses such territorial conflicts with state-sponsored terrorism by creating a game-theoretic model inspired by the infinite horizon Rubinstein game. The game addresses the major issue of incomplete and private information by incorporating conviction of sponsorship, audience costs, efficiency of terrorist organizations, and benefits from potential attacks using parameters and probabilities. The equilibrium analysis and comparative statics analysis indicate that when a demanding state is convinced that its competitor is a state sponsor of terrorism, making a more generous demand to avoid conflict and attacks helps restore peace in the region. Furthermore, if the demanding state has to pay a smaller price while making a generous demand, it certainly should for the sake of peace and protection of its civilians. This paper provides real-world evidence by focusing on the India-Pakistan war and using specific conflicts within it that fit the model’s presumptions.

Table of Contents

Disclaimer 1

Introduction 2

A Model for a Two-State Territorial Conflict with a State-Sponsored Terrorist Group 9

Strategies and Expected Utilities 14

Equilibrium 16

Propositions 16

Comparative Statics and Properties of Equilibrium Values q*and c* 19

Properties of q* 19

Properties of c* 21

Case Study: India-Pakistan Conflict 23

Historical Background 23

1988-1994: JKLF’s Impact on India-Pakistan Relations 24

2003-2005 India and Pakistan “Hand of Friendship” 27

Further Evidence 29

Shortcomings and Further Research 29

Conclusion 30

References 32

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