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Network formation with NIMBY constraints

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  • Block, Lukas

Abstract

The expansion of power networks is often hampered by local protests against certain power lines (’not-in-my-backyard’). For that matter, we study the structure of these networks with an application of a network formation game in order to determine the emergence of such a protest. We examine the existence of Nash-stable networks and their characteristics, when no player wants to make an alteration. Stability within this game is only reached if each player is sufficiently connected to a power source but is not linked to more players than necessary. In addition, we introduce the Nash-stable network algorithm which constructs a Nash-stable network with heterogeneous players.

Suggested Citation

  • Block, Lukas, 2023. "Network formation with NIMBY constraints," Energy Economics, Elsevier, vol. 119(C).
    • Handle: RePEc:eee:eneeco:v:119:y:2023:i:c:s0140988322005990
    DOI: 10.1016/j.eneco.2022.106470
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    References listed on IDEAS

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    More about this item

    Keywords

    Network formation; NIMBY; Power networks; Nash stability;
    All these keywords.

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods

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