Section: New Results
Applications to Environmental Issues
Participant : Alain Jean-Marie.
Sustainable management of water consumption
Continuing a series of game-theoretic studies on sustainable management of water resources, A. Jean-Marie, jointly with T. Jimenez (CERI/LIA, Univ Avignon) and M. Tidball (INRA), consider in  the basic groundwater exploitation problem, in the case where agents (farmers) have incomplete information about other agents' profit functions and about pumping cost functions. Farmers behave more or less myopically. The authors analyze two models where they assume that each agent relies on simple beliefs about the other agents' behavior. In a first model, a variation of their own extraction has a first order linear effect on the extractions of others. In a second model, agents consider that extraction of the others players is a proportion of the available water. Farmers' beliefs are updated through observations of the resource level over time. The paper also considers two models with a myopic feature and no learning. In the first one, agents do not know the profit function of the other agents and cost is announced before extraction. In the second one agents know the profit function of the other player and cost is announced after extraction. In this last case agents play a Nash equilibrium. The four behaviors are compared from the economic and environmental points of view.
Pollution permit trading
In a joint work with K. Fredj (Univ of Northern British Columbia, Canada), G. Martín-Herrán (Univ Valladolid, Spain) and Mabel Tidball (INRA), A. Jean-Marie investigated in  the strategic behaviour of two countries or firms that minimize costs facing emission standards. Emission standards can be reached through emission reduction, banking or borrowing, and emission trading in a given and fixed planning horizon. The authors extend classical models with: the introduction of transaction costs in tradeable emission markets on the one hand, and using a dynamic game setting, on the other hand. They analyze the case with and without transaction costs and the case with and without discount rate. They characterize socially optimal solutions and Nash equilibria in each case and, depending on the initial allocation, characterize the buyer and seller in the emission trading market. The main findings prove that the agents' equilibrium is not efficient when transaction costs are positive.