Principal-agent relationship in resource management, multiple principals and spatial dynamics

Philippe Delacote, Arnaud Dragicevic and Serge Garcia
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Arnaud Dragicevic: Laboratoire d'Economie Forestière, INRA - AgroParisTech

No 2014-10, Working Papers - Cahiers du LEF from Laboratoire d'Economie Forestiere, AgroParisTech-INRA

Abstract: Public authorities (often local) frequently mandate public or private agencies to manage their natural resources. Contrary to the agency, which is an expert in resource management, public authorities usually do not know the sustainable harvest level. In this paper, we model the contractual relationship between a principal, who owns the resource, and an agent, who holds private information on its sustainable harvest level, and look for the Pareto-optimal allocations. The agent can strategically use his private information to harvest outside the sustainability interval. We consider the case where the agent simultaneously interacts with several principals. From a simple dynamic spatial game, we show how the existence of multiple interacting principals with diverse qualities on information can help the least wellinformed principals to reduce the information rent and lead to the Pareto-optimal allocation.

Keywords: Resource management; Sustainable harvesting; Principal-agent model; Spatial dynamics (search for similar items in EconPapers)
JEL-codes: D82 Q20 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2014-10, Revised 2014-10
New Economics Papers: this item is included in nep-agr, nep-cta and nep-ure
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http://www6.nancy.inra.fr/lef/Cahiers-du-LEF/2014/2014-10 First version, 2010

Related works:
Working Paper: Principal-agent relationship in resource management, multiple principals and spatial dynamics (2014)
Working Paper: Principal-agent relationship in resource management, multiple principals and spatial dynamics (2014)
Working Paper: Principal-agent relationship in resource management, multiple principals and spatial dynamics (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:lef:wpaper:2014-10

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