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Competing For Endogenous Information In An Irreversible Environmental Resource Problem: A Game-Theoretic Analysis

Author

Listed:
  • GIUSEPPE ATTANASI

    () (LERNA, Toulouse School of Economics, Manufacture des Tabacs, 21 Allee de Brienne, Toulouse, 31000, France;
    LEE/LINEEX, Universitat Jaume I, Campus Riu Sec, Castellon, 12071, Spain)

  • ALDO MONTESANO

    () (Department of Economics, Bocconi University, via U. Gobbi, 5, Milan, 20136, Italy)

Abstract

The paper analyzes strategic behavior in a two-stage environmental choice problem under different information scenarios. Given uncertainty about environmental cost and irreversibility of development, "learning without destroying" emerges from strategic competition when information is endogenous and publicly available. This happens since agents trade off the higher payoff of being the first-mover against the potentially free acquisition of endogenous information without developing their own environmental endowment. We prove that in a 2X2 dynamic environmental game with payoff uncertainty and irreversibility publicly available endogenous information could lead players to destroy less in aggregate terms with respect to the case in which information is exogenous.

Suggested Citation

  • Giuseppe Attanasi & Aldo Montesano, 2008. "Competing For Endogenous Information In An Irreversible Environmental Resource Problem: A Game-Theoretic Analysis," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 10(03), pages 229-243.
  • Handle: RePEc:wsi:igtrxx:v:10:y:2008:i:03:n:s0219198908001911
    DOI: 10.1142/S0219198908001911
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    References listed on IDEAS

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    1. Avinash K. Dixit & Robert S. Pindyck, 1994. "Investment under Uncertainty," Economics Books, Princeton University Press, edition 1, number 5474.
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    Cited by:

    1. Attanasi, Giuseppe Marco & Montesano, Aldo, 2010. "Testing Value vs Waiting Value in Environmental Decisions under Uncertainty," TSE Working Papers 10-154, Toulouse School of Economics (TSE).

    More about this item

    Keywords

    Public endogenous information; irreversibility; testing value; Subject Classification: C72; Subject Classification: D81; Subject Classification: Q32;

    JEL classification:

    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • C0 - Mathematical and Quantitative Methods - - General
    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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