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More rewards for mass conflict is usually better, but you'd have to prevent gaming the system. AKA everyone choosing a single side to gain the benefits. Maybe both sides gain some sort of benefit, while the losing side gets less, but rewards are averaged over a side to discourage bandwagoning (i.e. the same rewards get distributed over the entirety of the side, so each individual nation gets less on the more popular side). I would suggest a colonization or exploration event, instead of a conflict-oriented one. Maybe a new continent on Orbis is discovered and alliances/nations can contribute resources to exploration efforts for bonuses. However, bonuses are determined by AA total divided by number of AA nations to increase the bonus to smaller but more cohesive AAs. Or maybe a technology oriented one, where two different technology standards are put up for material support, much like HDDVD and Blue-Ray or AC vs. DC current. Both of those would encourage resource competition without direct warfare, which is much more like the "Cold Wars" or "trade wars" that happen in the real world. That's not to say actual wars wouldn't erupt over them to reduce the resources of the other side, but warfare would only be one dimension of the conflict (which could include trade collusion and large-AA bank transfers to smaller-average-score AAs on their side). Edit: I want to add that resource competition (rather than military competition) would allow neutral AAs to get involved without ruining their neutrality. They aren't actually attacking anybody. Just contributing resources to a common goal, which may require negotiations with other AAs. This encourages them to engage with the community, even if they don't engage in warfare.

Translated to English: Lucia Svadin: "Hello, I am Lucia Svadin, and we have breaking news..." BREAKING NEWS!!! Lucia Svadin: "The KAF and the KDM have reached a great milestone in the development of the defense of Khevin as of late. They have recently established several missile defense programs with the aid of several allies, such as, Rozalia sending an eight million Khevinist Ruble loan, Tomasious Rubinlord of Entakuq selling one hundred tons of aluminum, and Mothman of Mothaya sending us one thousand tons of steel for free. In a new press release, the new minister of defense Habibullah Sewick, appointed today, stated, "We are very happy to announce that we have built a missile launch pad in Tokiaqitm. We could not have done this without the help of Grand Hermiteer Tomasious Rubinlord, our dear ally to the south, Mothman, and the Celestial Emperor of Roz Wei, Rozalia. This will be another sign of Khevinist strength. We will proud to defend this great nation with much power. And who knows, we might be able to defeat the SARF with this missile.'" Prototype of the Missile Lucia Svadin: "The MDP will be split into three sections. The first section will be conventional missiles, the second section will be elephant feces missiles, and the third section will be chemical and biological missiles. This is a great step for the military and the protection of the Khevinist people. I'm Lucia Svadin, have good day, and good news."

Wouldn't it make individual controversies in alliances about which sides should one take, or furthermore- force others to fight each other in the same alliance?

And events.