Book Review: The Two-State Dilemma

The Two-State Dilemma: A Game Theory Perspective on the Israeli Palestinian Conflict (Barlow Publishing), By Michael Dan

By RAJA G. KHOURI and JEFFREY J. WILKINSON.

Michael Dan’s new book, The Two-State Dilemma: A Game Theory Perspective on the Israeli-Palestinian Conflict, makes three bold and provocative statements within its opening pages: One: “The two-state game has ended; a new game is now underway.” Two: “What’s happening today in the Palestinian Territories isn’t occupation – it’s colonization.” Finally, “What further use do we have for Zionism? Why bother clinging to an ideological relic from the nineteenth century?”

Dan writes dispassionately about issues that have inflamed passions on all side for decades, and in these three statements, he implodes the principal arguments held so dearly by progressive Zionists: That the two-state solution is dead, that we can no longer call for an end to the occupation because it is de facto colonization; and that Zionism is an anachronistic notion that has served its purpose and is no longer worth holding onto.

Dan pushes this even further by declaring that Israel is not a liberal democracy, but an ethnocracy, meaning that “according to its own constitution, Israel is not a ‘state of all its citizens.’ The legal sovereign of the state of Israel is the Jewish people – regardless of their citizenship status or place of residence in the world.”

Michael Dan
Michael Dan

The author makes clear his book is not prescriptive, but “it might help us to think about [the conflict] in original and counter-intuitive ways.” After setting the table with the above proactive statements, he gives a primer on game theory for conflict resolution, beginning with the well-known “prisoner’s dilemma,” in which two individuals, acting in their own self-interest, will never produce the optimal outcome, but if they cooperate, can both do better.

Game theory, as outlined by Dan, relies on non-zero sum (non-binary) solutions to difficult situations. He states: “Since biblical times, every major conflict in the Middle East has been framed as an ‘us versus them’ trade-off: a zero-sum game in which one side’s gains represent the other side’s losses. Game theory on the other hand provides “an opportunity for rational co-operation between two opponents.”

In the prisoner’s dilemma, where two prisoners have an option of snitching on each other to the police or remaining silent, the best possible collective outcome for both is realized when the prisoners cooperate and remain silent. Betrayal of the other by both would produce the worst possible collective outcome. The key ingredient to cooperation is a high level of trust. Will the other party cooperate if I did, and what is the risk to me if they don’t?

When applied to the Palestinian-Israeli conflict, Dan feels the best collective outcome is achieved by a one-state solution in which everyone will have equal rights and access to the entire land of Historic Palestine. Such a “utopian scenario” will require a great deal of trust between the two parties.

The two-state option is second best, given that while it produces, for each party, independence from the other, each side will have access to only their part of a divided land.

The author believes there are no desirable remaining options, which are a non-democratic Zionist state where a Jewish minority governs over a Palestinian majority (because of demographics); or a democratic Arab state where an Arab majority rules over a Jewish minority.

Dan’s focuses on the “Nash Equilibrium” and the “Pareto Principle,” and applies those to the Israeli-Palestinian conflict. The Nash Equilibrium is when suspicion of the other leads you to try to undermine the other party before they do the same to you. It very much describes the behavior of Palestinians and Israelis throughout the Oslo peace process. The Pareto Principle is the opposite: Optimality is achieved by arriving at the best possible collective outcome. Dan writes:

From a game theory perspective, the Israeli-Palestinian conflict may be reduced to a dilemma between co-operating with the other side (be it Israeli or Palestinian) in the hope that they will co-operate with you, or betraying the other side because you’re almost certain that they will betray you. It all comes down to trust. 

Dan brings a cool, surgical approach to his analysis. Those traits come honestly: He’s a trained neurosurgeon and a PhD in medicine, with an MBA to boot. A social entrepreneur, he’s donated millions to First Nations, universities, St. John of Jerusalem Eye Hospital, and various charities.

He’s uncompromising, both in his analysis of how we got here, and his conclusions in how to move forward. He lays out a strong case in support of his three opening statements, charting how the notion of two states failed 80 years ago with the Peel Commission and has “been on life support ever since.”

He unflinchingly makes his case that Zionism is a colonial project whose usefulness has run its course, while the occupation is a colonization by a military power. He supports these arguments by painting a detailed historical account of what has happened from the inception of the Zionist vision to today.

Dan denotes three Zionist dilemmas: Demographics (which do not favour Jews), Palestinian national legitimacy (recognized by former Prime Minister Yitzhak Rabin as part of the Oslo Accords), and the partitioning of Historic Palestine (that has continuously failed). Using game theory, he shows how each of these dilemmas feed into the other and renders the status quo an impossible zero-sum exercise.

The author’s scientific approach may defuse some of the natural emotions the reader will certainly bring to the subject. This dispassion also creates a feeling of neutrality that some might view as insensitivity to the plight of Palestinians. We would argue that Dan’s pragmatic approach is especially valuable in these times, in which rhetoric from both sides rarely allows room for objective reasoning.

Applying game theory to the Israeli-Palestinian conflict is a bold new approach and this is a very worthwhile read. Dan’s precision in his examination of history and deployment of science in order to rethink this age-old conflict is refreshing. The integrity of his analysis is hard to come by, as is the courage of his convictions.


Raja Khoury
Raja Khoury

Raja Khouri is founder and CEO of  Khouri Conversations, was founding president of the Canadian Arab Institute, a former Ontario Human Rights Commissioner, is Canada Committee member of Human Rights Watch, and co-founder of the Canadian Arab/Jewish Leadership Dialogue Group.


Jeff Wilkinson
Jeffrey J. Wilkinson, PhD

Jeffrey J. Wilkinson, PhD, is an educator, facilitator and researcher focused on the psycho-social causes of intractable conflicts, researching not only how these conflicts are formed, but also how they may be undone over time.



Raja and Jeffrey are the co-authors of an upcoming book addressing the current polarization in the Jewish-Palestinian discourse within the two Diasporas.