All That Is Left To You: Game Theory Reductions of the Israel-Palestine Conflict

A seminar with Alexei Abrahams, MEI Research Fellow, PhD in Economics, Brown University.

Abstract

Pro-Palestinian activists often attempt to advance their cause by appealing to universal ideals of human rights and international law. But in a region where such ideals poorly predict actual behavior, activists should instead begin by internalizing the realpolitik of their circumstances, then figure out what can be achieved under these constraints. In this presentation we take a step towards doing this. We present qualitative and quantitative evidence that the Occupation (1967-present) fits the mold of a classic principal-agent paradigm, wherein the principal (Israel), seeking to suppress Palestinian resistance, weighs the costs of direct suppression against the costs of incentivizing an agent (the Palestinian Authority, or PA) to carry out indirect suppression. This principal-agent paradigm becomes our filter by which to make sense of (reduce) Israel's behavior over the last three decades, including their entry into the peace process in the early 1990s, subsequent territorial concessions and foreign aid flows to the PA (1993-present), and the blockading and bombing of Gaza (2007-present). Having reduced the Occupation to this principal-agent paradigm, we then discuss "all that is left to you": the narrow way forward for pro-Palestinian activists. Drawing on the classic works of two Harvard economists, we identify two difficult problems that activists must solve in order to move forward: the "credible threat" problem (Thomas Schelling) and the "collective action" problem (Mancur Olsen).