Rationality and Rivalry: A Game-Theoretic Analysis of the Turkey-Greece Aegean Dispute

The Aegean dispute between Türkiye and Greece remains one of the most persistent interstate rivalries in the Eastern Mediterranean, structured around overlapping claims and recurrent frictions concerning maritime zones, national airspace, and the (de)militarised status of Aegean islands, islets, and rocks. While episodes of escalation – most notably the Kardak/Imia crisis–have periodically raised the risk of a wider confrontation, the conflict has largely been managed through controlled, low-intensity interaction rather than open warfare. This article explains that pattern through a gametheoretic model that formalises the strategic interdependence of the two actors and clarifies the logic of their observed behaviour. The study models the dispute as a sequential game in which each side is assumed to act rationally and can choose among three stylised strategies–aggressive, passive-aggressive, and passive–depending on its assessment of the situation and the expected response of the other. A decision tree specifies the structure of interaction and the associated payoffs, and the equilibrium logic is derived via backward induction. The model yields a clear implication: under the specified preference ordering, both sides converge on passive-aggressive behaviour as the outcome that maximises attainable payoffs while limiting the risks of uncontrolled escalation. Substantively, the results account for the empirical regularity of reciprocal demonstrations of presence– naval manoeuvres, air and maritime incidents, and other forms of harassment or signalling–that allow each government to project resolve and defend reputational claims without crossing the threshold into direct military confrontation. By providing a transparent strategic rationale for this “managed tension” equilibrium, the article contributes to a more precise understanding of why the Aegean dispute persists and why crisis dynamics often stabilise at the level of chronic, low-intensity rivalry rather than culminating in full escalation.