The Conservation Multiplier
No 8283, CESifo Working Paper Series from CESifo
EvEvery government that controls an exhaustible resource must decide whether to exploit it or to conserve and thereby let the subsequent government decide whether to exploit or conserve. This paper develops a model of this situation and shows when a small probability that some future government will exploit has a multiplier effect on earlier decisions. The multiplier can be taken advantage of by a lobby paying for exploitation, or by a donor compensating for conservation. The analysis also uncovers when compensations are optimally offered to the president, the party in power, the general public, or to the lobby group.
Keywords: dynamic games; exhaustible resources; deforestation; political economy; lobbying; multiple principals; conservation. (search for similar items in EconPapers)
JEL-codes: D72 C73 Q57 O13 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-env, nep-gth and nep-pol
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_8283
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