Reassessing Principal–Agent Theory: The Houthis’ evolving relationship with Iran

This essay reassesses principal-agent theory through the evolving relationship between Iran and the Houthis. It argues that the conflicts following 7 October 2023 expose an important weakness in conventional understandings of proxy warfare: plausible deniability no longer reliably protects the principal from escalation. While principal-agent theory has often treated delegation as a way for states to project influence while limiting the costs and risks of direct involvement, the Iran-Houthi case suggests that this logic has become harder to sustain.

It shows how the Houthis’ growing military capabilities, political reach, and operational autonomy have made them a more consequential but also less controllable partner for Tehran. At the same time, rivals increasingly attribute Houthi actions to Iran regardless of the exact degree of Iranian command and control. This means that attribution, rather than proven control, can drive escalation. As a result, delegation may expose the principal to reputational, strategic, and military costs that it cannot fully manage.

The text is part of a POMEPS collection that explores whether and how the events in the Middle East since 7 October requires us to rethink our theoretical tools and approaches.

In December 2025, POMEPS convened a workshop at Aarhus University in Denmark, bringing together scholars to collectively interrogate these questions: what core concepts, theories, or hypotheses in Middle East IR require rethinking in the light of October 7 and its aftermath? What changes, if any, are needed in how we study the Middle East? Does Israel’s rapid expansion of military operations across the entire region and the potential outcomes of another war with Iran represent a change of the regional order or just a more routine evolution within the existing order? The workshop followed in the footsteps of a workshop hosted at Aarhus University a decade earlier, which had brought American, European, and Middle Eastern IR theorists into close dialogue about the field, and more recently built upon a POMEPS workshop on regional order hosted a year earlier at the European University Institute in Florence, Italy. This volume of POMEPS Studies collects papers from the Aarhus workshop, which interrogate a wide range of concepts