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Revealing Preferences: Empirical Estimation of a Crisis Bargaining Game with Incomplete Information

  • Jeffrey B. Lewis (a1) and Kenneth A. Schultz (a2)

We develop an empirical estimator directly from an extensive-form crisis bargaining game with incomplete information and discuss its features and limitations. The estimator makes it possible to draw inferences about states' payoffs from observational data on crisis outcomes while remaining faithful to the theorized strategic and informational structure. We compare this estimator to one based on a symmetric information version of the same game, using the quantal response equilibrium proposed in this context by Signorino (1999, American Political Science Review 93:279–298). We then address issues of identification that arise in trying to learn about actors' utilities by observing their play of a strategic game. In general, a number of identifying restrictions are needed in order to pin down the distribution of payoffs and the effects of covariates on those payoffs.

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Alexandra Guisinger , and Alastair Smith . 2002. “Honest Threats: The Interaction of Reputation and Political Institutions in International Crises.” Journal of Conflict Resolution 46:175200.

James D. Morrow 1985. “A Continuous Outcome Expected Utility Theory of War.” Journal of Conflict Resolution 29:473502.

Peter J. Partell , and Glenn Palmer . 1999. “Audience Costs and Interstate Crises: An Empirical Assessment of Fearon's Model of Dispute Outcomes.” International Studies Quarterly 43:389405.

Thomas J. Rothenberg 1971. “Identification in Parametric Models.” Econometrica, 39:577591.

Kenneth A. Schultz 2001. Democracy and Coercive Diplomacy. Cambridge, UK: Cambridge University Press.

Curtis S. Signorino 2003. “Structure and Uncertainty in Discrete Choice Models.” Political Analysis 11:316344.

Alastair Smith . 1998. “International Crises and Domestic Politics.” American Political Science Review 92:623638.

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Political Analysis
  • ISSN: 1047-1987
  • EISSN: 1476-4989
  • URL: /core/journals/political-analysis
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