A sheriff, two bullets and three problems

In: Public choice, Volume 130, Issue 3-4, p. 347-362

Abstract

This paper analyzes deterrence in international conflicts. Assume a strong country has several opponents and faces a military capacity constraint, which is not exhausted after just one war. Two main effects are at work. If the strong country is constrained, then reputation is more expensive and may occur less often. The problem is that the opponents may (but need not) be more aggressive compared to a world without a constraint. It may be that an "axis of evil" does not exist before a war occurs, but is implicitly formed even by moderate countries after the first war was waged. A point of interest is whether the constrained strong country should obtain additional capacity, given that the objective is to minimize the number of wars. The analysis sheds some new light on the U.S. foreign policy, the United Nations and the "axis of evil.". Adapted from the source document.