This paper uses a dynamic model with asymmetric players to explore the question: in a second-best world, should environmental regulations for transboundary pollutants be carried out locally or centrally? We find that combined payoffs are larger with decentralized control if payoffs are...

In this paper, we analyze the question of membership in a non-renewable resource cartel, with specific application to OPEC. One would expect the benefits of cartel membership to be positively related to the size of remaining reserves, while domestic petroleum consumption should be negatively...

We analyze learning in a two-person simultaneous choice repeated game. Agents form beliefs about their rival's strategies, which they revise as the game progresses. We test this model using data from a series of experiments. We obtain data on subjects' expectations by asking them to predict...

Cooperative equilibria can be supported in a repeated game when players use trigger strategies. This paper tests how well trigger strategies explain behavior in two-person experimental games. Reducing payoffs for choices larger than the Cournot level induces smaller average outputs, behavior...

This paper reports the results of a series of two-stage, two-person non-cooperative games where one player can strategically preempt the other. In one of our designs, the subgame perfect equilibrium entails complete preemption; in the other, it entails partial preemption. Logit analysis...

Multimarket contact between duopolists in an X and Y market is modelled with a trigger strategy. We show that mildly restrictive price-cap regulation in the X market decreases Y market quantities; but restrictive caps in the X market have a positive impact on Y market outputs. Behavior in...

In the past decade, innovations in hydraulic fracturing and horizontal drilling have fueled a boom in the production of natural gas (as well as oil) from geological formations — primarily deep shales — in which hydrocarbon production was previously unprofitable. Impacts on US fossil fuel...

We model countries' choice of greenhouse gas (GHG) emissions as a dynamic game. Emissions generate immediate benefits to the emitting country but also increase atmospheric GHG concentrations that negatively affect present and future welfare of all countries. Because there are no international...

Economists have analyzed potential for damages from climate change from theoretical analyses and with Integrated Assessment Models (IAMs). Analytical models typically write damages as a function of the carbon stock, while IAMs typically view damages as based on temperatures. In this paper, we...