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Fighting pollution when decisions are strategic

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Abstract

In this paper we analyse anti-pollution policies in a 2-by-2 game played between a “polluter” and the “police” in which the payoffs can be manipulated by an exogenous third player called the “policy-maker.” We show that the efficiency of the policies may depend on whether the players of the 2-by-2 game choose Nash equilibrium strategies or prefer maximin.

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Authors and Affiliations

  1. Institute of Economics, University of Hamburg, Von-Melle-Park 5, D-2000, Hamburg 13

    Manfred J. Holler

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  1. Manfred J. Holler
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Additional information

This paper has been accomplished while the author was a member of the Institute of Economics and Statistics at the University of Aarhus. I would like to thank Friedel Bolle and the anonymous reviewers of this Journal for helpful comments on an earlier version of this paper.

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Holler, M.J. Fighting pollution when decisions are strategic. Public Choice 76, 347–356 (1993). https://doi.org/10.1007/BF01053304

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  • DOI: https://doi.org/10.1007/BF01053304

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