We discuss an analytically tractable discrete-time dynamic game in which a finite number of players extract a renewable resource. We characterize a symmetric Markov-perfect Nash equilibrium of this game and derive a necessary and sufficient condition under which the resource does not become...

The collective welfare of crop plants, their microbial symbionts, farmers, and society can be undermined by tragedies of the commons. A crop could increase resource allocation to grain if each plant invested less in sending roots into soil already explored by neighbors and less in stem growth....

Central bank credit has expanded dramatically in some of the euro area member countries since the beginning of the financial crisis. This paper makes two contributions to understand this stylized fact. First, we discuss a simple model of monetary policy that includes (i) a credit channel and...

We study the effect of heterogeneous growth in demand on resource extraction. Using the Great Fish War framework of Levhari and Mirman (1980), we show that heterogeneity in demand growth has a profound effect on both cooperative and non-cooperative solutions.

Between 1950 and 2030, the share of the world's population that lives in cities is predicted to grow from 30% to 60%. This urbanization has consequences for the likelihood of climate change and for the social costs that climate change will impose on the world's quality of life. This paper...

We develop a dynamic recursive model where political and economic decisions interact, to study how excessive debt-GDP ratios affect political sustainability of prudent fiscal policies. Rent seeking groups make political decisions - to cooperate (or not) - on the allocation of fiscal budgets...

A tragedy of the commons appears when the users of a common resource have incentives to exploit it more than the socially efficient level. We analyze the situation when the tragedy of the commons is embedded in a network of users and sources. Users play a game of extractions, where they decide...

Central bank credit has expanded dramatically in some of the euro area member countries since the beginning of the financial crisis. This paper makes two contributions to understand this stylized fact. First, we discuss a simple model of monetary policy that includes (i) a credit channel and...

In this paper, we address the “Tragedy of the Commons” (TOC) problem for shared-resource systems by considering different types of behaviors of agents. On one extreme are self-interested agents while on the other one, agents are concerned about the welfare of the society. Algorithms to...

Roger Scruton and others argue that market-based approaches and voluntary civic organizations can solve many environmental problems. The author argues in response that there are significant limitations to quota systems and similar market fixes, while NGOs and civil society “networks” are not...