Conflict is often used as a bargaining option, not simply as a final option. Conflict can reveal relative power that might otherwise have been hidden, which can influence future negotiations and make agreements more likely. But conflict can also reveal weaknesses, leading to higher demands from the stronger party, making agreements less likely and all- out war more likely. In this sense, conflict is a ''double-edged sword''.

These are among the findings of an empirical study by Dr Santiago Sánchez-Pagés, published in the July 2009 Economic Journal. His findings provide an explanation for a wide range of phenomena, including workers undertaking industrial action against multinational corporations; costly and protracted legal disputes between businesses; arguments between parents and children to show ''who''s boss''; and small countries fighting wars against bigger and more powerful ones, like the continued Taliban campaign against US and UK forces, which has recently shown signs of possible negotiation.

By studying 94 colonial and imperial conflicts between 1817 and 1988, the author shows that many of those ending in agreements were the result of conflict being used as a bargaining tool. The sample includes three conflicts between UK and Afghan forces, prompting the question: could history be repeating itself?

The author argues that if conflict is used as a bargaining tool, its purpose is to reveal relative strengths – often of the underestimated force. The longer the conflict lasts, the more information both sides have about the strength of the other.

Thus, the longer the conflict, the more likely it should be to end, as both sides now better understand their relative strengths, a point from which to restart negotiations. This relationship exists for conflicts ending in agreement – but not for those ending in submission – suggesting conflict was used as a bargaining tool for conflicts ending in agreement.

This can help explain what the author calls the ''uneven contenders paradox'':

''Parties actually choose the scope and intensity of the conflicts they fight when they disagree: India and Pakistan have not used nuclear weapons, only engaged in skirmishes; Pepsi and Coca Cola do not fight worldwide price wars, but only national; family arguments do not necessarily imply divorce.''

The problem with conflict as a bargaining tool – aside from the obvious expenditure of time, resources and possibly loss of life – is that it can sometimes reveal unknown weaknesses. This can lead the stronger party to make higher demands or destroy the opponent whereas, without conflict, an agreement might have been possible.

This study builds on the observations of the Prussian soldier and military theorist Carl von Clausewitz who famously said: ''War is a continuation of political activity by other means.'' 

''Conflict as Part of the Bargaining Process'' is published in the July 2009 issue of the Economic Journal.

Data come from the Extra-systemic wars dataset of the 3.0 Correlates of War project database – see Sarkees, MR (2000), ''The Correlates of War Data on War: An update to&##160;1997'', Conflict Management and Peace Science 18(1): 123-44.