Assume two nations are involved in an arms race. They both assume that each faces two choices – sign disarmament accord or continue with military expansion and the building of more nuclear missiles

Explain using the prisoner's dilemma model why both of these nations will choose to escalate the arms race rather than choose bilateral disarmament. During the Cold War President Ronald Reagan was quoted as saying that the United States will "trust, but verify" when discussing nuclear nonproliferation agreements between the U.S. and the Soviet Union. How does this relate to your answer to the first part of this question?

Neither nation can be certain that the other one will remain faithful to such an agreement; therefore, they both incline towards military expansion. President Reagan's comment implies that he agrees with this problem of faithfulness but believes a solution might be inspection by the other nation.