This paper studies the relationship between international conflict and the size distribution of countries in a model in which both peaceful bargaining and non-peaceful confrontations are possible. We show how the size distribution of countries depends on the likelihood, benefits and costs of...

This paper provides a formal model of endogenous country formation and of choice of defense spending in a world with international conflict. The model is consistent with three observations. First, secessions and, more generally, break-up of countries should follow a reduction in the likelihood...