Abstract
We study a model in which two players with opposing interests try to alter a status quo through instability‐generating actions. We show that instability can be used to secure longer‐term durable changes, even if it is costly to generate and does not generate short‐term gains. In equilibrium, instability generated by a player decreases when the status quo favors them more. Equilibrium always exhibits a region of stable states in which the status quo persists. As players' threat power increases, this region shrinks, ultimately collapsing to a single stable state that is supported via a deterrence mechanism. There is long‐run path‐dependency and inequity: although instability eventually leads to a stable state, it typically selects the least favorable one for the initially disadvantaged player.
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