Extinction in common property resource models: an analytically tractable example

Tapan Mitra and Gerhard Sorger

Economic Theory, 2014, vol. 57, issue 1, 57 pages

Abstract: We discuss an analytically tractable discrete-time dynamic game in which a finite number of players extract a renewable resource. We characterize a symmetric Markov-perfect Nash equilibrium of this game and derive a necessary and sufficient condition under which the resource does not become extinct in equilibrium. This condition requires that the intrinsic growth rate of the resource exceeds a certain threshold value that depends on the number of players and on their time-preference rates. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Tragedy of the commons; Extinction; Markov-perfect Nash equilibrium; C73; Q20 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (19)

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DOI: 10.1007/s00199-013-0799-2

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