Rohner, Dominic; Thoenig, Mathias; Zilibotti, Fabrizio - Oxford Centre for the Analysis of Resource-Rich … - 2011
beliefs on the average propensity to trade of the other group. Since conict disrupts trade, the onset of a conflict signals … that the aggressor has a low propensity to trade. Agents observe the history of conflicts and update their beliefs over … process whose frequency depends on the state of endogenous beliefs. Second,the probability of future conflicts increases after …