Article ID: | iaor20124100 |
Volume: | 63 |
Issue: | 6 |
Start Page Number: | 790 |
End Page Number: | 809 |
Publication Date: | Jun 2012 |
Journal: | Journal of the Operational Research Society |
Authors: | Zhuang J, He F |
Keywords: | combinatorial optimization |
In this paper, we apply a sequential game to study the possibility of ‘contracts’ (or at least mutually beneficial arrangements) between a government and a terrorist group. We find equilibrium solutions for complete and incomplete information models, where the government defends and/or provides positive rent, and the terrorist group attacks. We also study the sensitivities of equilibria as a function of both players’ target valuations and preferences for rent. The contract option, if successful, may achieve (partial) attack deterrence, and significantly increase the payoffs not only for the government, but also for some types of terrorist groups. Our work thus provides some novel insights in combating terrorism.