Games with Adaptation and Mitigation

Natali Hritonenko, Victoria Hritonenko and Yuri Yatsenko
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Natali Hritonenko: Department of Mathematics, Prairie View A&M University, Prairie View, TX 77446, USA
Victoria Hritonenko: Department of Sciences, Mathematics and Biotechnology, University of California Extension, Berkeley, CA 94704, USA

Games, 2020, vol. 11, issue 4, 1-16

Abstract: We formulate and study a nonlinear game of n symmetric countries that produce, pollute, and spend part of their revenue on pollution mitigation and environmental adaptation. The optimal emission, adaptation, and mitigation investments are analyzed in both Nash equilibrium and cooperative cases. Modeling assumptions and outcomes are compared to other publications in this fast-developing area of environmental economics. In particular, our analysis implies that: (a) mitigation is more effective than adaptation in a crowded multi-country world; (b) mitigation increases the effectiveness of adaptation; (c) the optimal ratio between mitigation and adaptation investments in the competitive case is larger for more productive countries and is smaller when more countries are involved in the game.

Keywords: economic-environmental model; environmental adaptation; pollution mitigation; Nash equilibrium (search for similar items in EconPapers)
JEL-codes: C C7 C70 C71 C72 C73 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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