Does Flexibility Facilitate Sustainability of Cooperation Over Time? A Case Study from Environmental Economics

Javier Frutos () and Guiomar Martin-Herran
Additional contact information
Javier Frutos: Universidad de Valladolid

Journal of Optimization Theory and Applications, 2015, vol. 165, issue 2, No 17, 657-677

Abstract: Abstract In this paper we present nonlinear incentive strategies that can be applied to a class of differential games that are frequently used in the literature, in particular, in environmental economics literature. We consider a class of nonlinear incentive functions that depend on the control variables of both players and on the current value of the state variable. The strategies are constructed to allow some flexibility in the sense that, unlike the common literature on the subject, the optimal state path evolves close to the cooperative trajectory. As a consequence of this flexibility, the incentive equilibrium is credible in a larger region than the one associated with the usual linear incentive strategies.

Keywords: Differential games; Cooperation; Incentive equilibria; Credibility; Environmental economics; 49N70; 49N90; 91A12; 91A23 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s10957-014-0573-z Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:joptap:v:165:y:2015:i:2:d:10.1007_s10957-014-0573-z

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10957/PS2

DOI: 10.1007/s10957-014-0573-z

Access Statistics for this article

Journal of Optimization Theory and Applications is currently edited by Franco Giannessi and David G. Hull

More articles in Journal of Optimization Theory and Applications from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().