The textbook rule for choosing the most cost-effective project actually becomes the worst possible strategy in a competitive environment.
Conservation efforts and resource allocation fail when using standard cost-effectiveness ratios against an adversary. A value-first rule is mathematically superior because it prevents competitors from anticipating and exploiting your next move. Managers usually assume that stretching every dollar for the highest immediate return is always the best path. This knapsack reversal shows that being predictable in your efficiency makes you vulnerable to being outmaneuvered. Real-world success requires prioritizing the most valuable targets even when they seem expensive.
Adversarial Procurement in Two-Value Space: Insights and Evidence for Conservation Siting
SSRN · 6705959
We identify and study a new structural class of allocation problems, adversarial procurement in two-value space: a mission-driven, budget-constrained buyer faces an active rival whose valuation aligns with the buyer's acquisition price, so price is both a cost and a signal of rival removal risk. Conservation siting provides the most transparent instance; the same structure arises in other domains. <div> Two lessons emerge from computational, formal, and empirical analysis. First, rivalry changes