I examine the determinants of con ‡ict and settlement by embedding probabilistic contests in a bargaining framework. Di¤erent costly enforcement e¤orts (e.g., arming, litigation expenditures) induce di¤erent disagreement points and Pareto frontiers. After examining the incentives for settlement, I demonstrate how di¤erent division rules and bargaining norms have real, economic e¤ects. I then analyze some sources of con ‡ict. I emphasize long-term, strategic considerations by examining an

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... ative model and discussing particular historical examples. *Written for special memorial issue in honor of Jack Hirshleifer.