RT info:eu-repo/semantics/article
T1 Promotion of cooperation when benefits come in the future: A water transfer case
A1 Cabo García, Francisco José
A1 Tidball, Mabel
K1 Environmental Economics
K1 Differential games
K1 Cooperative differential game
K1 non-cooperative differential game
K1 imputation distribution procedure
K1 instantaneous side-payment
K1 time-consistent solution
AB This paper presents a two-regime differential game, with a first period in which twocountries cooperate in a joint investment project to construct a specific infrastructure. Thisperiod ends when the infrastructure is finished, which serves to increase each player’s welfarein a subsequent non-cooperative game played by the two countries thereafter. We define animputation distribution procedure (IDP) to share the investment costs during cooperationaccording to each player’ future benefits. We prove that the IDP is time consistent if at anytime within the cooperative period each country’s share on the surplus to go is equal to orconverges towards the country’s relative gains from the existence of the infrastructure (real-ized in the subsequent non-cooperative period). Furthermore, we obtain the instantaneousside-payment scheme which makes the IDP feasible. The mechanism is studied for a jointinvestment project to build a water canal to transfer water between a surplus and a deficitriver basin.
PB Elsevier
SN 0928-7655
YR 2017
FD 2017
LK http://uvadoc.uva.es/handle/10324/32413
UL http://uvadoc.uva.es/handle/10324/32413
LA eng
NO Resource and Energy Economics, 47, pp. 56-71.
NO Producción Científica
DS UVaDOC
RD 26-abr-2024