Changing threat perceptions and the efficient provisioning of international security

This paper proposes a mechanism for structuring international institutions to efficiently provision global security against the threat of a rogue nation. The effects of security effort by an alliance member are assumed to be non-rival and non-excludable for other members. Specifically, this effort has both positive and negative effects, as security measures prevent attacks by the rogue nation, but also involves loss of commercial and diplomatic benefits. Further, the alliance members are assumed to have heterogeneous tastes regarding the desired security level. The allies act strategically vis-a-vis one another with regard to security provision, and the alliance a whole acts strategically with respect to the rogue nation, which strategizes in turn. Importantly, this paper investigates how the evolution of public opinion, in the respective countries facing the rogue nation's threat, impacts the proposed mechanism.