Where there are dwarves, there are kobolds. In the east, the dwarves try to drive the kobolds out of their kingdoms, or keep them as little more than slaves. In the west, the dwarves are a little more tolerant of their draconic neighbors; they allow them to carve out tunnels of their own and work in the dwarven mines for pay rather than forced labor. They are not seen as anything near equals in any case. The dwarves' efforts are only marginally effective; kobolds dig into dwarven tunnels constantly and set up warrens at the drop of a hat.