Israel and the PLO: A Game with Differential Information

Abstract

This chapter presents the PLO as Player I (rows player) with three policies (rows) and two possible types. Israel is presented as Player II (columns player) with four policies (columns) and two possible types. A situation is described in the medium term planning horizon, that is, three to five years. The other conceivable players in the arena—for example, the U.S. and Jordan—are not ignored; their strategic behavior is incorporated in the considerations leading to the construction of the outcomes. The chapter reviews the main concept of strategic games with differential and incomplete information. Each of the two players faces a whole spectrum of policies, which is ranked from the most conciliatory to the most aggressive. The first task limits the range of policies of each player. Israel's dependence on the U.S. restrains it from adopting the most aggressive policies, while the popular consensus within Israel determines the bound on its most conciliatory policies. Similarly, Palestinian popular support and the survival of the PLO determine its most conciliatory policy. The shape of the function relating pairs of policies to outcomes is simple. If both players choose aggressive policies, the probability of war increases, whereas if both players select conciliatory policies, the chances of a settlement increase up to certainty. If an aggressive policy of one side is pitted against a conciliatory policy of the other side, the status quo may prevail.