The Credible Commitment Problem in the Third-Party Mediation of the Mindanao Peace Process, 1975–2014

Negotiated settlements of civil wars are challenging since incompatibilities take a long time to resolve. Many scholars have approached this puzzle by identifying information asymmetry and commitment problems as critical deterrents to resolution. Similarly, this article argues that third-party mediation could improve or worsen the parties’ credible commitment problems, as illustrated in the Mindanao peace process mediation that spanned almost four decades. Following a contingency framework in analyzing third-party mediation, this article analyzes existing reports, statements, and peace process agreements using a process tracing methodology. The article argues that the success of a peace process could be attributed to how mediation resolves the parties’ credible commitment problems, which are evident in three aspects of the peace process: getting the parties to negotiate, the use of mediator leverage, and the promise of third-party monitoring and enforcement.

Allies or Commitment Devices? A Model of Appointments to the Federal Reserve

We present a model of executive-legislative bargaining over appointments to independent cen-tral banks in the face of an uncertain economy with strategic economic actors. The model highlights the contrast between two idealized views of Federal Reserve appointments. In one view, politicians prefer to appoint conservatively biased central bankers to overcome credible commitment problems that arise in monetary policy. In the other, politicians prefer to appoint allies, and appointments are well described by the spatial model used to describe appointments to other agencies. Both ideals are limiting cases of our model, which depend on the level of economic uncertainty. When economic uncertainty is extremely low, politicians prefer very conservative appointments. When economic uncertainty increases, politicians’ prefer central bank appointees closer to their own ideal points. In the typical case, the results are somewhere in between: equilibrium appointments move in the direction of politician’s preferences but with a moderate conservative bias.

Territorial wars and absolute outcomes

Why do some wars end with an absolute outcome, with state death or regime change? I argue that we are more likely to see absolute outcomes when we have territorial disputes with the potential for credible commitment problems and asymmetric disputants. In the absence of credible commitment problems, disputes are less likely to recur, and states are unlikely to seek to absorb the opponent state or remove its government. Among more symmetric disputants, states cannot impose an absolute outcome, and we are more likely to see recurrent disputes in the face of credible commitment problems. Only in very asymmetric dyads are we likely to have both the required willingness and opportunity to impose absolute outcomes to attempt to solve a credible commitment problem over territorial conflict.

Outsourcing versus technology transfer: Hotelling meets Stackelberg

This paper considers a Hotelling duopoly with two firms A and B in the final good market. Both A and $B$ can produce the required intermediate good, firm B having a lower cost due to a superior technology. We compare two contracts: outsourcing (A orders the intermediate good from B) and technology transfer (B transfers its technology to A). First we show that an outsourcing order acts as a credible commitment on part of A to maintain a certain market share in the final good market. This generates an indirect Stackelberg leadership effect, which is absent in a technology transfer contract. We show that compared to the situation of no contracts, there are always Pareto improving outsourcing contracts but no Pareto improving technology transfer contracts. Finally, it is shown that whenever both firms prefer one of the two contracts, all consumers prefer the other contract.

Introduction

This chapter introduces the central empirical puzzle and the primary theoretical insight of the book. In course of several rounds of interviews, current and former Maoist rebels in North and South India shared that they were not able to quit the insurgent organization even if they wanted to. This was because they feared that they could be killed post-retirement, unarmed and defenseless, by either their former enemies or by their former comrades, while the Indian state would lose nothing for failing to protect them. This creates a problem of credible commitment in the process of surrender of rebels, which, this book shows, is resolved locally by informal exit networks, more proficiently in the South of India than in the North. This chapter also introduces the district-level data on surrender of Maoists and other testimonies from the conflict zone to illustrate the vast regional variation in retirement of Maoist rebels in North and South India.

Rebel Retirement in the South through Harmonic Exit Networks

This chapter shows how grassroots civic associations that grew in the gray zone of state-insurgency interface in the South became sites of incubation of informal exit networks, which facilitate safe passage of Maoists from insurgency to democracy in Telangana. Based on the rebels’ account of the protracted process of retirement, this chapter also highlights, both empirically and theoretically, the various actors and processes in rebel retirement, including the operation of the two mechanisms of trust and side payment that help resolve the problem of credible commitment locally. This chapter shows that the militant mass mobilization by the Maoists in the South created conditions for vibrant associational life in the gray zones of the South, which allowed various actors and processes of rebel retirement to function and proliferate.

Farewell to Arms

How do rebels give up arms and return to the political system that they once sought to overthrow? Policymakers often focus on incentives like cash and jobs to lure rebels away from extremism. From the rebels’ perspective, however, physical safety is more important than these livelihood options. Rebels quit extremist groups only when they know that they can disarm without getting killed in the process. This book shows that retiring Maoist rebels in India believe that they could lose their lives after they disarm, targeted either by enemies they made during their insurgent career or by their former comrades. However, the Indian state would lose nothing if it failed to keep its side of the bargain and protect disarmed rebels. This creates a problem of credible commitment, which, in the absence of institutional mechanisms, is addressed locally by informal exit networks that emerge from grassroots civic associations in the gray zones of state-insurgency interface. Maoist retirement is high in South India and low in the North due to emergence of two distinct types of exit networks in these two conflict locations. By showing that the type of exit network depends on local social bases of an insurgency and the ties of an insurgent organization to society, this book brings civil society into the study of insurgency in a theoretically coherent way.