Reformulated claims bargaining gives players perverse incentives to demand everything.

Evidence

The tacit game now has a perverse incentive structure. There is no rational reason for either player to demand less than the whole of the available reward; each knows this and knows that the other knows it. There is no incentive to reduce one’s claim because any residual dispute costs the player no more than he would lose if he reduced his claim to eliminate the dispute. The single equilibrium point yields zero for both players. — Thomas C. Schelling, The Strategy of Conflict, 627

Categorization

• XREF: Evokes Gambetta on private protection markets and how hostage/claim dynamics in Mafia contracting create similar perverse incentive equilibria. — connects to: One player’s promise can worsen the other player’s position — Thomas C. Schelling, The Strategy of Conflict, 787

Related

• One player’s promise can worsen the other player’s position (similarity 0.81)

Broader Connections

• One player’s promise can worsen the other player’s position #expands (0.78) — Thomas C. Schelling, The Strategy of Conflict, 787