Revisiting the Madman Theory: Evaluating the Impact of Different Forms of Perceived Madness in Coercive Bargaining

This article reconsiders the theoretical logic behind the “Madman Theory”—the argument that it can be beneficial in coercive bargaining to be viewed as mad, or insane. I theorize about how we can best define perceived madness in a way that is relevant for analyzing coercive bargaining. I identify four types of perceived madness, broken down along two dimensions. The first dimension is whether a leader is perceived to (a) make rational calculations, but based on extreme preferences, or (b) actually deviate from rational consequence-based decision making. The second dimension is whether a leader’s madness is perceived to be (a) situational or (b) dispositional. I argue that situational extreme preferences constitute the type of perceived madness that is most helpful in coercive bargaining. I illustrate my argument using case studies of Adolf Hitler, Nikita Khrushchev, Saddam Hussein, and Muammar Gaddafi.