Fight or Flight: Endogenous Timing in Conflicts

Boris van Leeuwen, Theo Offerman, Jeroen van de Ven
2020 Review of Economics and Statistics  
We study a dynamic game in which players compete for a prize. In a waiting game with two-sided private information about strength levels, players choose between fighting, fleeing, or waiting. Players earn a "deterrence value" on top of the prize if their opponent escapes without a battle. We show that this value is a key determinant of the type of equilibrium. For intermediate values, sorting takes place with weaker players fleeing before others fight. Time then helps to reduce battles. In an
more » ... ce battles. In an experiment, we find support for the key theoretical predictions, and document suboptimal predatory fighting.
doi:10.1162/rest_a_00961 fatcat:4k2tuntia5afxpq6au7npk5q3y