Reference : Strategic Exploitation of a Common-Property Resource under Uncertainty
Scientific journals : Article
Scientific journals : Article
http://hdl.handle.net/10993/8506
Strategic Exploitation of a Common-Property Resource under Uncertainty
English
Koulovatianos, Christos mailto [University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA) >]
Antoniadou, Elena [University of Cyprus]
Mirman, Leonard J. [University of Virginia]
2013
Journal of Environmental Economics and Management [= JEEM]
Elsevier
65
1
28-39
Yes (verified by ORBilu)
International
0095-0696
1096-0449
Amsterdam
Netherlands
[en] Renewable resource exploitation ; stochastic non-cooperative dynamic games ; the commons
[en] We construct a game of noncooperative common-resource exploitation which delivers analytical solutions for its symmetric Markov-perfect Nash equilibrium. We examine how introducing uncertainty to the natural law of resource reproduction affects strategic exploitation. We show that the commons problem is always present in our example and we identify cases in which increases in risk amplify or mitigate the commons problem. For a specific class of games which imply Markov-perfect strategies that are linear in the resource stock (our example belongs to this class), we provide general results on how payoff-function features affect the responsiveness of exploitation strategies to changes in riskiness. These broader characterizations of games which imply linear strategies (appearing in an Online Appendix) can be useful in future work, given the technical difficulties that may arise by the possible nonlinearity of Markov-perfect strategies in more general settings.
http://hdl.handle.net/10993/8506
10.1016/j.jeem.2012.05.005

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