The paradox of power revisited: internal and external
Ivan Lopez Cruz
· Gustavo Torrens
Received: 12 November 2016 / Accepted: 21 May 2018
© Springer-Verlag GmbH Germany, part of Springer Nature 2018
Abstract This paper develops a two-level model of internal and external conﬂict in
which the paradox of power holds for internal conﬂict, but not for external conﬂict. In
the model, internal conﬂict is imbedded in a situation of external conﬂict. Agents in a
group ﬁght over the distribution of resources within the group, but they cooperate to
ﬁght against other groups. Agents with low economic productivity have an advantage
in the internal conﬂict game because they face a lower opportunity cost for investments
in weapons. However, it is easier for more productive groups to mobilize resources for
external conﬂict, and as a result they have an advantage over less productive groups.
The model helps to explain why economically unproductive individuals may enjoy
high living standards relative to more productive ones, but more developed groups
usually defeat and conquer less developed ones. An extension of the model shows
that groups with more unequal distribution of productivity might have an advantage in
external conﬂict. The model can also be extended to study the effects of trade on the
intensity of the paradox of power and income distribution within and across groups.
We would like to thank Sebastian Galiani, Jorge Streb, the editor and three anonymous reviewers for their
insightful comments. We would also like to thank the Ostrom Workshop for its ﬁnancial support.
Electronic supplementary material The online version of this article (https://doi.org/10.1007/s00199-
018-1130-z) contains supplementary material, which is available to authorized users.
Ivan Lopez Cruz
Sabanci University, Istanbul, Turkey
Indiana University, Bloomington, USA