Arbitration as a Means for Resolving Major International Disputes

Conventional wisdom maintains that, although arbitration may sometimes be useful to resolve minor disputes between nations, nations will not agree to arbitration when their vital interests are involved. Such a view is unreasonable; arbitration may be the best approach when nations, especially the major powers, cannot resolve crucial disputes through negotiations. Prospects for arbitration may be enhanced by the model proposed herein, maximizing a social welfare function combining the utilities of all the parties to a dispute, which includes uncertain, disputed parameters. On the other hand conventional game-theory modeling tends to emphasize threats rather than the peaceful resolution of disputes.