Feedback Nash equilibria for non-linear differential games in pollution control
Dynamic problems of pollution and resource management with stock externalities often require a differential games framework of analysis. In addition they are represented realistically by non-linear transition equations. However, feedback Nash equilibrium (FBNE) solutions, which are the desired ones in this case, are difficult to obtain in problems with non-linear-quadratic structure. We develop a method to obtain numerically non-linear FBNE for a class of such problems, with a specific example for shallow lake pollution control. We compare FBNE solutions, by considering the entire equilibrium trajectories, with optimal management and open-loop solutions, and we show that the value of the best FBNE is in general worse than the open-loop and optimal management solutions.
Year of publication: |
2008
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Authors: | Kossioris, G. ; Plexousakis, M. ; Xepapadeas, A. ; de Zeeuw, A. ; Mäler, K.-G. |
Published in: |
Journal of Economic Dynamics and Control. - Elsevier, ISSN 0165-1889. - Vol. 32.2008, 4, p. 1312-1331
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Publisher: |
Elsevier |
Saved in:
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