Prospect theory: Contributions to understanding actors, causes and consequences of conflict in Africa

Abstract

Despite many recognized shortcomings, Rational Choice Theory remains the dominant perspective on decision-making in the literature on African conflict, whether overtly acknowledged or not. Prospect Theory, originally derived from the field of behavioural economics, can complement and advance this perspective not only by explaining the behaviour of actors, but also by allowing for predictions and the devising of strategies to avoid or end on-going conflicts based on a set of systematic biases that influence how actors make decisions. After a brief definition of Prospect Theory, this work will begin with an overview of the existing literature on decision-making as it relates to conflict, examine how Rational Choice is inadequate in explaining much human behaviour and thus how Prospect Theory can fill this gap. It will then move on to give a fuller definition of the various hypotheses derived from Prospect Theory that pertain to the study of conflict. An example of the application of Prospect Theory to a related field in which thorough research has been conducted, Deterrence Theory, will be used to demonstrate the model’s potential for study in other areas. This will be followed by a more in-depth analysis of the ways in which Prospect Theory can contribute to understanding the behaviour of actors in war, the causes of conflict, and the consequences in the African context. It will conclude with a summary and proposition for further research that can advance this analysis.