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Excellent article by Lawrence Wright:

Al Qaeda was originally envisioned as a kind of Sunni foreign legion, which would defend Muslim lands from Western occupation….

Bin Laden had asked Zarqawi [founder of ISIS] to merge his forces with Al Qaeda, in 2000, but Zarqawi had a different goal in mind. He hoped to provoke an Islamic civil war, and, for his purposes, there was no better venue than the fractured state of Iraq, which sits astride the Sunni-Shiite fault line….Violent attacks would create a network of “regions of savagery,” which would multiply as the forces of the state wither away, and cause people to submit to the will of the invading Islamist force….[A] broad civil war within Islam would lead to a fundamentalist Sunni caliphate.

In other words, Al Qaeda is focussed on expelling the West from the Middle East but ISIS is focussed on creating a Sunni Islamic superstate. Hence, Al Qaeda attacks the West but ISIS attacks Shiites. This leads to different “realist” policy prescriptions – self-interest implies attacking Al Qaeda but not necessarily ISIS. It leads to the same neocon policy prescriptions – there will be a humanitarian crisis from civil war and democracy (to the extent Iraq is a democracy) is threatened. Hence, send in the troops say Kristol and Kagan, just as they did before Gulf War II.

Romney advisor Richard Williamson says that the Middle East protests would not have happened under a President Romney:

“In Egypt and Libya and Yemen, again demonstrations — the respect for America has gone down, there’s not a sense of American resolve and we can’t even protect sovereign American property.”

The implicit logic is that the protests are caused by weakness on the part of America.  The protestors are taking advantage of us because they think we will not strike back.  If we are strong, the protestors would be deterred by the threat of American reprisals. So, as President Romney would be strong, foreign policy would be easier as there would be no events like this.

But there is an equally (more?) compelling reverse logic.  The protestors are weak.  They are extremists who have little support in the population.  But if America is aggressive even the moderates in the population will favor fighting fire with fire.  Of course the extremists attacking the embassies would be happy if we withdrew.  But their strategy would also succeed if we respond with aggression.   So, the right move is not to over-react.  Use proxies to fight this battle.  Perhaps the moderates in the local populations themselves would be willing to work with us as they have a lot to lose if tensions escalate and conditions worsen.

The situation calls for smart lateral thinking not a one-size-fits-all bellicosity.

Netanyahu is aggressively trying to persuade President Obama to draw a “red line” on Iran – if Iran crosses the line, presumably drawn on the level of uranium enrichment, they would face a US attack.  Such an attack would set back the Iranian nuclear program but it would likely unify the Iranian population behind the regime and make them redouble their efforts to go nuclear.  So, we should also evaluate what might happen if Iran does go nuclear before we commit to a strategy of a preemptive strike.  It turns out that Jim Fearon thought this through a while ago and did a little empirical work to flesh out the historical record.  He finds:

China, France, India, Israel, Pakistan, and the UK all saw declines in their total militarized dispute involvement in the years after they got nuclear weapons.  A number of these are big declines. USSR/Russia and South Africa have higher rates in their nuclear versus non-nuclear periods, though it should be kept in mind that for the USSR we only have four years in the sample with no nukes, just as the Cold War is starting.

The whole article is an interesting read.

The roses in your garden are dead and your gardener tells you that there are bugs that have to be killed if you want the next generation of roses to survive.  So you pay him to plant new roses and spray poison to keep the bugs away.

Each week he comes back and tells you that the bugs are still threatening to kill the roses and you will need to pay him again to spray the poison to keep them away.  This goes on and on.  At what point do you stop paying him to spray poison on your roses?

Keep in mind that if there really are bugs waiting to take over once the poison is gone, you are going to lose your roses if you stop spraying.  So you are taking a big risk if you stop.  On the other hand, only he really knows for sure if the bugs are threatening, you are just taking his word for it.

Now add to that the possibility that the poison is not guaranteed.  You may have an infestation even in a week where he sprays.  Of course this only happens if the bugs are a threat.  If you spray for many weeks and you see no infestation this is a pretty good sign that the bugs are not a threat at all.

If you do stop spraying at some point, on what basis do you make that decision?  Assuming he is spraying vigilantly you would optimally stop after many weeks of no infestation.  You would continue for sure if one week the bugs return even though he was spraying.

But you don’t know for sure that he is actually spraying.  You are paying him to do it, but you are taking his word for it that he is actually spraying.  If you assume that he is doing his job and spraying vigilantly, and you therefore follow the decision rule above, and if we wants to keep his job then he won’t be spraying vigilantly after all.

So what do you do?

I am attending a workshop organized by Eli Berman at UCSD.  Eli and his co-authors have been studying the military surge in Afghanistan.  Colonel Joe Felter, a key member of the research team, presented an overview of the theory of counterinsurgency (COIN) – How can the Afghan government and the US forces “win hearts and minds”?

Think of Apple and Samsung competing for consumers.  In the end, a consumer hands over some cash and gets an iPad or a Galaxy.  Both sides of the exchange have sealed the deal, an exchange of a product for money.  The theory of COIN works the same way.  Two potential governments compete for allegiance from an undecided population.  They offer them security and public goods in exchange for allegiance.  They may also use coercion and violence to compel compliance.  There is a key difference – an Afghan citizen can take the goodies offered by the U.S., claim he will offer his allegiance and then withhold it.  The exchange takes place over time and there is no “contract” that guarantees payment of allegiance for US bounty.

The Afghans will offer their allegiance to the government that will be around in the long run.  And the Taliban tell them, “The Americans have watches but we have the time.”  And this strategic issue undercuts the theory of COIN.  How can the surge work if one of the firms that is trying to sell you a product won’t be around to honor the warranty?

In the New Yorker, Lawrence Wright discusses a meeting with Hamid Gul, the former head of the Pakistani secret service I.S.I. In his time as head, Gul channeled the bulk of American aid in a particular direction:

I asked Gul why, during the Afghan jihad, he had favored Gulbuddin Hekmatyar, one of the seven warlords who had been designated to receive American assistance in the fight against the Soviets. Hekmatyar was the most brutal member of the group, but, crucially, he was a Pashtun, like Gul.

But

Gul offered a more principled rationale for his choice: “I went to each of the seven, you see, and I asked them, ‘I know you are the strongest, but who is No. 2?’ ” He formed a tight, smug smile. “They all said Hekmatyar.”

Gul’s mechanism is something like the following: Each player is allowed to cast a vote for everyone but himself.  The warlord who gets the most votes gets a disproportionate amount of U.S. aid.

By not allowing a warlord to vote for himself, Gul eliminates the warlord’s obvious incentive to push his own candidacy to extract U.S. aid. Such a mechanism would yield no information.  With this strategy unavailable, each player must decide how to cast a vote for the others.  Voting mechanisms have multiple equilibria but let us look at a “natural” one where a player conditions on the event that his vote is decisive (i.e. his vote can send the collective decision one way or the other).   In this scenario, each player must decide how the allocation of U.S. aid to the player he votes for feeds back to him.  Therefore, he will vote for the player who will use the money to take an action that most helps him, the voter.  If fighting Soviets is such an action, he will vote for the strongest player.  If instead he is worried that the money will be used to buy weapons and soldiers to attack other warlords, he will vote for the weakest warlord.

So, Gul’s mechanism does aggregate information in some circumstances even if, as Wright intimates, Gul is simply supporting a fellow Pashtun.

The daring raid on Osama Bin Laden’s Pakistani hideout has deeply embarrassed the Pakistani military and secret service ISI.  American helicopters were able to fly in undetected, kill the world’s most wanted man and leave with his body.  We might speculate about the consequences for Al Qaeda and the possible acceleration of withdrawal of American troops from Afghanistan.  Instead, I thought I would talk about the implication of the American attack on Pakistan.

First, if Navy Seals were able to fly in and steal Osama Bin Laden, might they be able to steal Pakistan’s nuclear materials?   A much more difficult and perhaps impossible enterprise with weapons at different locations, some of them mobile. But the Abottabad adventure was highly improbable too. Therefore, one result of the death of OBL is that the Pakistanis will guard their nuclear weapons with more diligence. This is good for the rest of the world as it reduces the chances of a WMD falling into the hands of extremists.  It is bad to the extent that the rest of the world (i.e. the US!) has plans to capture Pakistani WMDs in some emergency scenario.

Second, the Pakistani military does not come out of this incident looking good. Either they are incompetent, unknowingly allowing OBL to live in an army town, or they are complicit, deliberately harboring a terrorist where he might be least likely to be found.  In either scenario, Pakistan might think that the American action emboldens India.  India now has cover to adopt a more aggressive stance against Pakistan.  This in turn implies that Pakistan might adopt a more aggressive stance itself to counteract any reputational fallout from its perceived ineptitude.  Some kind of cross-border incident in Kashmir is an obvious move for Pakistan to engineer.  There is some distance between Pakistani politicians and the military and some kind of “confidence-building” move by India might help to forestall any increase in tension.  Such a move unfortunately is politically difficult given the huge suspicion of the Pakistani military and ISI following on the heels of the discovery of OBL living safely in Abottabad.

The sources in this report say yes.  These reporters look again and conclude no.  I don’t believe any of them.  The basic fact is that we have no good data on the costs and benefits of torture and we never will.

Once you have decided whether you or not you believe the practitioner/advocates of torture when they say that torture gets results then these stories contain no new information, and here’s why:  all of the information comes from them.  There is no independent source.

If you already believed that torture works then you came to that belief because they told you and today they are just telling you the same thing again.  On the other hand, if you didn’t believe it that’s because you don’t trust them when they say it works and today you are just hearing another ex-post rationalization by people with dirty hands.

Complaining about TSA screening is considered by the TSA to be cause for additional scrutiny.

Agent Jose Melendez-Perez told the 9/11 commission that Mohammed al-Qahtani “became visibly upset” and arrogantly pointed his finger in the agent’s face when asked why he did not have an airline ticket for a return flight.

But some experts say terrorists are much more likely to avoid confrontations with authorities, saying an al Qaeda training manual instructs members to blend in.

“I think the idea that they would try to draw attention to themselves by being arrogant at airport security, it fails the common sense test,” said CNN National Security Analyst Peter Bergen. “And it also fails what we know about their behaviors in the past.”

The now metered and paywall protected NYT reports:

The Obama administration is engaged in a fierce debate over whether to supply weapons to the rebels in Libya, senior officials said on Tuesday, with some fearful that providing arms would deepen American involvement in a civil war and that some fighters may have links to Al Qaeda.

Why?

Even if fighters do not have links to Al Qaeda or Hezbollah, what is there to guarantee that they are or will remain friendly to the Western allies?  Gaddafi while historically unfriendly had finally been seduced with Mariah Carey concerts and Coca Cola. Arming the rebels might fulfill a short term objective of regime change but at the cost of creating an armed future enemy.  What’s the debate?

This is an easy one: North Korea thinks (1) the US is out to exploit and steal resources from other countries and hence (2)  Libya was foolish to giving away its main weapon, its nascent nuclear arsenal, which acted as a deterrent to American ambition. Accordingly,

“The truth that one should have power to defend peace has been confirmed once again,” the [North Korean] spokesperson was quoted as saying, as he accused the U.S. of having removed nuclear arms capabilities from Libya through negotiations as a precursor to invasion.

“The Libyan crisis is teaching the international community a grave lesson,” the spokesperson was quoted as saying, heaping praise on North Korea’s songun, or military-first, policy.

In a perceptive analysis, Professor Ruediger Franks adds two more examples that inform North Korean doctrine.  Gorbachev’s attempts to modernize the Soviet Union led to its collapse and the emancipation of its satellite states.  Saddam’s agreement to allow a no-fly zone after Gulf War I led inexorably to Gulf War II and his demise.  The lesson: Get more nuclear arms and do not accede to any US demands.

Is there a solution that eliminates nuclear proliferation?  Such a solution would have to convince North Korea that their real and perceived enemies are no more likely to attack even if they know North Korea does not have a nuclear deterrent.  Most importantly, the US would have to eliminate North Korean fear of American aggression.  In a hypothetical future where the North Korean regime has given up its nuclear arsenal, suppose the poor, half-starved citizens of North Korea stage a strike and mini-revolt for food and shelter and the regime strikes back with violence.  Can it be guaranteed that South Korea does not get involved?  Can it be guaranteed that Samantha Power does not urge intervention to President Obama in his second term or Bill Kristol to President Romney in his first? No.  So, we are stuck with nuclear proliferation by North Korea.  The only question is whether North Korea can feel secure with a small arsenal.

Tomas Sjostrom and I offer one option for reducing proliferation in our JPE paper Strategic Ambiguity and Arms Proliferation.  If North Korea can keep the size and maturity of its nuclear arsenal hidden, we can but guess at its size and power.  It might be large or quite small – who knows.  This means even if the arsenal is actually small, North Korea can still pretend it is big and get some of the deterrent power of a large arsenal without actually having it.  The potential to bluff afforded by ambiguity of the size of weapons stockpiles affords strategic power to North Korea.  It reduces North Korea’s incentive to proliferate.  And this in turn can help the U.S. particularly if they do not really want to attack North Korea but fear nuclear proliferation.  Unlike poker and workplace posturing à la Dilbert, nuclear proliferation is not a zero-sum game.  Giving an opponent the room to bluff can actually create a feedback loop that helps other players.

 

Actions speak louder than words.  Anarchists seeking to spread revolution resort to extreme acts hoping to stir the sympathy of the general population.  Would be change-agents differ in their favored instrument of provocation – assassination, bombings or general strike.  They are united by their intrinsic lack of real power.  They only way they can hope to achieve their ends is by persuading other players to react and indirectly give them what they want.  As such, the “propaganda of the deed” in practiced typically by people on the fringe of society, not in the corridors of power.   (See my paper The Strategy of Manipulating Conflict with Tomas Sjöström for illustrations of this strategy.)

But Mubarak has reached this lowly state even as President of Egypt.  He has conspicuously lost popular support and tensions long suppressed have burst asunder for all to see.  He has lost the support of “the people” and, perhaps even more importantly, the army.  What can he do to get it back?  The anti-Mubarak protestors have till recently refrained from looting and mob mentality has been notable for its absence.  As long as that remains the case, the army and the people are siding with the anti-Mubarak protestors or largely staying out of the fray.  Mubarak’s only hope is to get the people and the army to pick his side.  He needs to energize the mob and trigger looting.  That is his strategy.  Police disappeared from the streets of Cairo a few days ago, inviting looters to run amok.  That did not work.  So, now he has employed pro-Mubarak “supporters” to fight anti-Mubarak protestors.  Open fighting on the streets of Cairo, prodding the army to step in.  The people scared of the outbreak of lawlessness turning to the strongman Mubarak to return some semblance of stability to the city and the country.  This is where we are in the last couple of days.  Another obvious strategy for Mubarak: Get his supporters to loot and pin it on the anti-Mubarak protestors.  Not sure if that is happening yet.

What can be done to subvert the Mubarak strategy?  For the protestors, the advice is obvious – no looting, no breakdown of law and order.  The primary audience is the army and people – keep them on your side.  For the Obama administration there is little leverage over Mubarak.  I assume he has hidden away millions if not billions – cutting off future aid has little chance of persuading Mubarak to do anything.  Again, the army is the primary audience for the Obama administration.  Whichever side they pick will win.  The army cares more about the cutoff of future aid than Mubarak.  They have trained in US military schools and have connections here.  The only leverage the Obama administration has is over the army and it is hard to tell how strong that leverage is.

This week I switched to models of conflict where each player puts positive probability on his opponent being a dominant strategy type who is hawkish/aggressive in all circumstances.  This possibility increases the incentive of a player to be aggressive if actions are strategic complements and decreases it if actions are strategic substitutes.  The idea that fear of an opponent’s motives might drive an otherwise dovish player into aggression comes up in Thucydides (“The growth of Athenian power and the fear this caused in Sparta, made war inevitable.”) and also Hobbes.  But both sides might be afraid and this simply escalates the fear logic further.  This was most crisply stated by Schelling in his work on the reciprocal fear of surprise attack (“[I]f I go downstairs to investigate a noise at night, with a gun in my hand, and find myself face to face with a burglar who has a gun in his hand, there is a danger of an outcome that neither of us desires. Even if he prefers to leave quietly, and I wish him to, there is a danger that he may think I want to shoot, and shoot first. Worse, there is danger that he may think that I think he wants to shoot. Or he may think that I think he thinks I want to shoot. And so on.”).  Similar ideas also crop up in the work of political scientist Robert Jervis.

Two sided incomplete information can generate this kind of effect. It arises in global games and can imply there is a unique equilibrium while there are multiple equilibria in the underlying complete information game.  But the theory of global games relies on players’ information being highly correlated.  Schelling’s logic does not seem to rely on correlation and we can imagine conflict scenarios where types/information are independent and yet this phenomenon still arises.  In this lecture, I use joint work with Tomas Sjöström to identify a common logic for uniqueness that is at work for information structures with positively correlated types or independent types.  Our sufficient conditions for uniqueness can be related to conditions that imply uniqueness in models of Bertrand and Cournot competition.

With these models in hand, we have some way of operationalizing Hobbes’ second motive for war, fear. I will use these results and models in future classes when I use them as building blocks to study other issues.  Here are the slides.

I am teaching a new PhD course this year called “Conflict and Cooperation”. The title is broad enough to include almost anything I want to teach.  This is an advantage – total freedom! – but also a problem – what should I teach?  The course is meant to be about environments with weak property rights where one player can achieve surplus by stealing it and not creating it.  To give some structure, I have adopted Hobbes’s theories of conflict to give structure to the lectures.  Hobbes says the three sources of conflict are greed, fear and honour. The solution is to have a government or Leviathan which enforces property rights.

Perhaps reputation models à la Kreps-Milgrom-Roberts-Wilson come closest to offering a game theoretic analysis of honour (e.g. altruism in the finitely repeated prisoner’s dilemma). But I will only do these if I get the time as this material is taught in many courses.  So, I decided to begin with greed.

I started with the classic guns vs butter dilemma: why produce butter when you can produce guns and steal someone else’s butter?  This incentive leads to two kinds of inefficiency: (1) guns are not directly productive and (2) surplus is destroyed in war waged with guns.  The second inefficiency might be eliminated via transfers (the Coase Theorem in this setting). This still leaves the first inefficiency which is similar to the underinvestment result in hold-up models in the style of Grossman-Hart-Moore.  With incomplete information, there can be inefficient war as well.  A weak country has the incentive to pretend to be tough to extract surplus from another.  If its bluff is called, there is a costly war. (Next time, I will move this material to a later lecture on asymmetric information and conflict as it does not really fit here.)

These models have bilateral conflict. If there are many players, there is room for coalitions to form, pool guns, and beat up weaker players and steal their wealth. What are stable distributions of wealth? Do they involve a dictator and/or a few superpowers? Are more equitable distributions feasible in this environment? It turns out the answer is “yes” if players are “far-sighted”. If I help a coalition beat up some other players, maybe  my former coalition-mates will turn on me next. Knowing this, I should just refuse to join them in their initial foray. This can make equitable distributions of wealth stable.

I am writing up notes and slides as I am writing a book on this topic with Tomas Sjöström.  Here are some slides.

The WSJ Ideas Market blog has a post by Chris Shea about my forthcoming paper with David Lucca (NY Fed) and Tomas Sjöström. (Rutgers) Some excerpts:

Full democracies are unlikely to go to war with one another. That’s axiomatic in political science. Yet a new study offers an important caveat: Limited democracies may, in fact, be even more bellicose than dictatorships…….

The authors end with a twist on President George W. Bush’s contention that “the advance of freedom leads to peace”: “Unfortunately,” they say, “the data suggests that this may not be true for a limited advance of freedom.”

Here is another article in Kellogg Insight about the paper.

You manage a colony of slave-maker ants.  It’s a small colony (not a knock on you, all slave-maker ant colonies are small) so you have only a handful of scouts to send out on an enslavement mission. Do you target a similarly weak colony (better odds) or the biggest and strongest around (better slaves)? According to this account of a study published in Animal Behavior, you risk it and go for the big prize.

It’s fun to theorize why:

Now, like most animal fables, this one can be spun in any number of ways. (Ants are particularly suitable for, or susceptible to, this.) Are the populous, well-defended colonies doing anything wrong? Do these attacks work because whoever’s running the big, powerful colony doesn’t mind losing a few small members? Is the answer more defenses, or subtler ones? Do you change how you live because of a small band of violent actors? Should the hostages fight back when they’re older? (They sometimes do.)

Homburg Howdyado: The Browser.

For the sake of argument let’s take on the plain utilitarian case for waterboarding: in return for the suffering inflicted upon a single terror suspect we may get information that can save many more people from far greater suffering. At first glance, authorizing waterboarding simply scales up the terms of that tradeoff. The suspect suffers more and therefore he will be inclined to give more information and sooner.

But these higher stakes are not appropriate for every suspect. After all, the utilitarian cost of torture comes in large part from the possibility that this suspect may in fact have no useful information to give, he may even be innocent. When presented with a suspect whose value as an informant is uncertain, these costs are too high to use the waterboard. Something milder is preferred instead like sleep deprivation.

So the utilitarian case for authorizing waterboarding rests on the presumption that it will be held in reserve for those high-value suspects where the trade-off is favorable.

But if we look a little closer we see it’s not that simple. Torture relies on promises and not just threats. A suspect is willing to give information only if he believes that it will end or at least limit the suffering. When we authorize waterboarding, we undermine that promise because our sleep-deprived terror suspect knows that as soon as he confesses, thereby proving that he is in fact an informed terrorist, he changes the utilitarian tradeoff. Now he is exactly the kind of suspect that waterboarding is intendend for. He’s not going to confess because he knows that would make his suffering increase, not decrease.

This is an instance of what is known in the theory of dynamic mechanism design as the ratchet effect.

Taken to its logical conclusion this strategic twist means that the waterboard, once authorized, can’t ever just sit on the shelf waiting to be used on the big fish. It has to be used on every suspect. Because the only way to convince a suspect that resisting will lead to more suffering than the waterboarding he is sure to get once he concedes is to waterboard him from the very beginning.

The formal analysis is in Sandeep’s and my paper, here.

An Israeli leftist believes that right-wing Prime Minister Neyanyahu can bring peace:

“The left wants to make peace but cannot, while the right doesn’t want to but, if forced to, can do it.”

Why can a right-winger make peace, while a left-winger cannot?  There might be many reasons but the one mentioned in this blog must of course draw from Crawford-Sobel’s Strategic Information Transmission which has become the canonical model of the game-theoretic notion Cheap Talk. The key intuition was identified by Cukierman and Tommasi in their AER paper “Why does it take a Nixon to go to China?” (working paper version).

Suppose an elected politician knows the true chances for peace but also has a bias against peace and for war.  The the median voter hears his message and decides whether to re-elect him or appoint a challenger.  Given the politician’s bias, he may falsely claim there is a good case for war even if it is not true.  It is hard for a politician biased towards war to credibly make the case for war.  He risks losing the election.  But if he makes the case for peace, it is credible: Why would a hawk prosecute for peace unless the case for peace is overwhelming?  So the more a politician proposes a policy that is against his natural bias, the higher is the chance he gets re-elected.  If the case for peace is strong, a war-biased politician can either propose war in which case he may not get re-elected and the challenger gets to choose policy.  Or he can propose peace, get re-elected and implement the “right” policy.  In equilibrium, the latter dominates and Nixon is necessary to go China, Mitterand is necessary for privatization etc…

Is this why Netanyahu believes he can make peace?   Maybe he cares about leaving a legacy as a statesman.  This would make him a less credible messenger – via the logic above, he is biased towards peace and any dovish message he sends is unreliable.  Let’s hope that the stories of his strongly his Zionist father and hawkish wife are all true.  And then Hamas should fail to derail the negotiations…And Hezbollah should fail in its efforts… And the other million stars that must align must magically find their place….

Regional data is available on civilian deaths from insurgent activity and counterinsurgent activity in Afghanistan.  There is also data on the level of insurgent attacks.  In principle, this might allow an analysis of the impact of civilian deaths on insurgent and insurgent support.  If civilian deaths caused by insurgents cause an increase in support for counterinsurgents, perhaps the local population will give information about insurgent location to the opposite side.  Then, insurgent attacks will decline.  If civilian deaths caused by caused counterinsurgent activity increase support for insurgents, perhaps insurgents find more recruits leading to more attacks in the future etc etc.

A recent paper by Condra et al attempts to study these issues.  One key finding:

“Counterinsurgent-generated civilian casualties from a typical incident are responsible for 6 additional violent incidents in an average sized district in the following 6 weeks.”

Are the causal statements water-tight?  I wasn’t sure but certainly the questions are apt.  This account summarizes many of the study’s findings.

This is Asia:

More here. Why am I posting this?

  1. Are civil wars more often North vs South than East vs West?  Put differently, based on the boundaries that have survived until today, are countries, on average, wider than they are tall?
  2. Which will arrive first:  the ability to make a digital “mold” of distinctive celebrity voices or the technology allowing celebrities to map the digital signature of their voice in order to claim property rights?
  3. The hard `r` in Spanish and other languages creates a natural syncopation because the r usually occupies the downbeat, as in “sagrada” or “cortado”
  4. Syncopation adds a dimension to music because brain tickles as it tries to make sense of two times at once.
  5. Among European soccer nations, the closer to Africa the fewer black players on the national team.

Obama has two focal options in Afghanistan, “Stay the Course” or “Cut and Run”.  Stay the Course means continuing the current counterinsurgency (COIN) strategy of “winning hearts and minds” of Afghan civilians.  Cut and Run means getting out as soon as possible and leaving the Afghans to deal with their own mess.  In either scenario it is optimal to sack McCrystal.

McCrystal is a strong believer in COIN so if you want to Cut and Run, it s better to replace him with someone else, a true believer in Cut and Run.  If Obama wants to Stay the Course, McCrystal is a possible candidate.  But there is a reputational cost, looking weak, to Obama of retaining McCrystal.  Replacing him carries the risk that the COIN strategy fails.  But Petraeus is the author of COIN so this risk is minimized if Petraeus replaces McCrystal.  So, even if you want to Stay the Course, it is optimal to sack McCrystal.

Pretty simple?

My first post on this topic was prompted by reading newspaper stories about Afghanistan and having lunch with Jim Robinson shortly afterwards.  (For example, Karzai is sacking trusty lieutenants and moving to form a coalition with the Taliban and perhaps Pakistan.)  But who has thought deeply about this issue and come up with some interesting insights?  The answer is of course: Roger Myerson.  He has an informal overview of his thoughts on state-building.  To understand his ideas fully, you have to read the overview.  Here are a few insights I pulled out that are most related to my earlier post.

One issue I raised was: How do you ensure political competition is constructive not destructive? Myerson says the key is that the losers in any political competition feel they have the opportunity to win a future competition.   Otherwise, what choice to they have but to compete from outside the political system and trigger conflict?

An alternative might be to install a puppet dictator who faces no competition.  But here I repeat my earlier point: this dictator will be rapacious and steal from his citizens.  To keep him in line, constructive political competition is necessary.

Myerson’s overview has his thoughts on how to build constructive national and local competition.  Again, I recommend you take a look.

Afghan security firms provide armed escorts for NATO convoys.  Some firms lost their employment because of violent incidents where they killed civilians.  But NATO Convoys them suffered greater attacks and the security firms were re-employed.  There is an obvious incentive problem:

“The officials suspect that the security companies may also engage in fake fighting to increase the sense of risk on the roads, and that they may sometimes stage attacks against competitors.

The suspicions raise fundamental questions about the conduct of operations here, since the convoys, and the supplies they deliver, are the lifeblood of the war effort.

“We’re funding both sides of the war,” a NATO official in Kabul said. The official, who spoke on the condition of anonymity because the investigation was incomplete, said he believed millions of dollars were making their way to the Taliban.”

This is a Mafia tactic: To get people to pay from protection, you have to create the demand for protection.  Supply creates its own demand.  There is also a reverse effect:  The security firms sometimes bribe the Taliban to keep away from the convoys.  With this source of steady income, the Taliban have no incentive to disband and may even have an incentive to expand.  Demand creates its own supply.

The second circle seems less pathological than the first.  If we cannot find the Taliban ourselves and kill them or bribe them then to stay away from the convoys, we have to use a local security firm.  The security firm is an intermediary, adding value and generating surplus.  The first circle is destroying surplus, like the Mafia.  It is creating a public bad, a security problem, to generate a transfer.

Beyond punishing anyone who is caught planning a deliberate attack, it is hard to see any simple solution.  Fewer and fewer countries want to be involved in Afghanistan and so using our own troops is difficult.  The Taliban might prefer to be employed in the real economy.  But the main alternative to attacking NATO convoys is growing opium.  Is that any better than attack and theft?

The entire episode signals that Afghanistan is a Mafia state with leaders acting an profit maximizers, destroying surplus to capture a bigger slice of what’s left of the economic pie.   A depressing state of affairs after eight years of war.

John F Kennedy was born in Brookline and attended Devotion School.  Our kids are attending Devotion this year and our third-grader took part in a lovely event at JFK’s birthplace last week.  There were some nice speeches, including one by the head of the JFK Presidential Library .  It involved this story:

When Jack was quite young but old enough to ride a bike, he played a game of Chicken with his older brother Joe, perhaps on the very street of his birthplace.  In classic fashion, they raced towards each other on their bikes.  Joe expected some respect from his younger brother.  Joe thought Jack would swerve and let him win the game.  No such luck.  They slammed into each other and had to go to hospital.

I had never heard this story before.  I mentioned it to several Americans but they had never heard it either.  Everyone knows the famous Chicken story: Khrushchev vs Kennedy during the Cuban Missile Crisis.

Schelling could always take commonplace strategic interactions and draw fundamental lessons from them.  Similarly, it would be nice to think that JFK’s childhood experience gave him some insight into how to play Chicken when the stakes were high.

Sandeep and I are very close to finishing a first draft of our paper on torture.  As I was working on it today, I came up with a simple three-paragraph summary of the model and some results.  Here it is.

A number of strategic considerations play a central role in shaping the equilibrium. First, the rate at which the agent can be induced to reveal information is limited by the severity of the threat.  If the principal demands too much information in a given period then the agent will prefer to resist and succumb to torture. Second, as soon as the victim reveals that he is informed by yielding to the principal’s demand, he will subsequently be forced to reveal the maximum given the amount of time remaining.  This makes it costly for the victim to concede and makes the alternative of resisting torture more attractive. Thus, in order for the victim to be willing to concede the principal must also torture a resistant suspect, in particular an uninformed suspect, until the very end.  Finally, in order to maintain principal’s incentive to continue torturing a resistant victim  the informed victim must, with positive probability, wait any number of periods before making his first concession.

These features combine to give a sharp characterization of the value of torture and the way in which it unfolds.  Because concessions are gradual and torture cannot stop once it begins, the principal waits until very close to the terminal date before even beginning to torture. Starting much earlier would require torturing an uninformed victim for many periods in return for only a small increase in the amount of information extracted from the informed.  In fact we show that the principal  starts to torture only after the game has reached the ticking time-bomb phase: the point in time after which the deadline becomes a binding constraint on the amount of information the victim can be induced to reveal. This limit on the duration of torture also limits the value of torture for the principal.

Because the principal must be willing to torture in every period, the informed victim concession probability in any given period is bounded, and this also bounds the principal’s payoff.  In fact we obtain a strict upper bound on the principal’s equilibrium payoff by considering an alternative problem in which the victim’s concession probability is maximal subject to this incentive constraint. This bound turns out to be useful for a number of results.   For example the bound enables us to derive an upper bound on the number of periods of torture that is independent of the total amount of information available.  We use this result to show that the value of torture shrinks to zero when the period length, i.e. the time interval between torture decisions, shortens.  In addition it implies that laws preventing indefinite detention of terrorist suspects entail no compromise in terms of the value of information that could be extracted in the intervening time.

A fungus is damaging opium poppies in Afghanistan.  The price of dry opium has gone up dramatically.  This is good for the Taliban in the short run as they have stockpiles of dry opium they can sell off at  higher price.  But in the medium term the price charged by farmers will go up as there is less crop to go around.  As input prices go up, profits go down.  Ceteris paribus, Taliban profits will go down in the medium term.  Drawn by higher profits, if entry of new farmers into opium production occurs in the long run, we will head back to the status quo.  Intermediate micro is kind of fun!

Seeing this logic at work, government intervention is possible: U.S. forces can discourage entry to keep input prices high and Taliban profits low.  I’m sure the Law of Unintended Consequences will be at work too.  What form it will take, by definition I cannot predict.

1. We have no clear strategy to deal with Iran’s nuclear ambitions.

2. The Taliban want peace.

3. Graham Allison gives Obama an “incomplete” on one aspect of his policy on nuclear arms.

4. Osama loves volleyball, de Gaulle and Field Marshall Montgomery.

Obama’s Nuclear Posture Review has been revealed.  The main changes:

(1) We promise not to use nuclear weapons on nations that are in conflict with the U.S. even if they use biological and chemical weapons against us;

(2) Nuclear response is on the table against countries that are nuclear, in violation of the N.P.T., or are trying to acquire nuclear weapons.

This is an attempt to use a carrot and stick strategy to incentivize countries not to pursue nuclear weapons.  But is it any different from the old strategy of “ambiguity” where all options are left on the table and nothing is clarified?  Elementary game theory suggests the answer is “No”.

First, the Nuclear Posture Review is “Cheap Talk”, the game theoretic interpretation of the name of our blog.  We can always ignore the stated policy, go nuclear on nuclear states or non-nuclear on nuclear states – whatever is optimal at the time of decision.  Plenty of people within the government and outside it are going to push the optimal policy so it’s going to be hard to resist it. Then, the words of the review are just that – words.  Contracts we write for private exchange are enforced by the legal system.  For example a carrot and stick contract between an employer and employee, rewarding the employee for high output and punishing him for low output, cannot be violated without legal consequences.  But there is no world government to enforce the Nuclear Posture Review so it is Cheap Talk.

If our targets know our preferences, they can forecast our actions whatever we say or do not say, so-called backward induction.  So, there is no difference between the ambiguous regime and the clear regime.

What if our targets do not know our preferences?  Do they learn anything about our preferences by the posture we have adopted? Perhaps they learn we are “nice guys”?  But even bad guys have an incentive to pretend they are nice guys before they get you.  Hitler hid his ambitions behind the facade of friendliness while he advanced his agenda.  So, whether you are a good guy or bad guy, you are going to send the same message, the message that minimizes the probability that your opponent is aggressive.  This is a more sophisticated version of backward induction. So, your target is not going to believe your silver-tongued oratory.

We are left with the conclusion that a game theoretic analysis of the Nuclear Posture Review says it seems little different from the old policy of ambiguity.

My approach to blogging is pretty simple.  When I have an idea I email it to myself.  My mail server deposits these in a special folder which I then dig through when I am ready to write something.  Some ideas don’t get written up and they start to attract dust.  I am going to clean the closet and write whatever I can think of about the ideas that piled up.  Here is one that Sandeep and I actually talked about some time ago, but I can’t now figure out where I wanted to go with it.

Shouldn’t gang wars end quickly?  All you have to do is kill the leader of the rival gang.  Instead, at least anectdotally, gang wars are more like wars of attrition.  You have the low-level thugs picking each other off and the leaders are relatively safe.  Why?

The leader embodies some valuable capital:  control of his organization.  Even if you could decapitate the rival gang by killing the leader it may be preferred to weaken him by taking out enough of his henchmen.  Then you can offer him a deal.  Maybe its a merger, maybe its a collusive agreement, but either way the point is that the coalition is more valuable with the opposing hierarchy intact than in disarray.  Knowing all of this, each gang leader feels perfectly safe even in the midst of an all-out war.

Under this theory, gang wars break out because a rival has become too powerful and it is no longer clear which is the dominant gang.  Its a necessary part of renegotiating the pre-existing power-sharing arrangement in light of a new balance of power.

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