Inter- and intragenerational renewableresource extraction

The paper develops a differential game in which there are overlapping generationsof extractors of a renewable resource. We consider intragenerational as well as intergenerationalcompetition between extractors. An interesting feature of the game, which isnovel in differential games, is the asynchronous horizons of the players resulting fromoverlapping generations. A feedback Nash equilibrium characterizing the extraction rates ofthe generations is identified. In particular, the value functions and the equilibrium strategiesare obtained in closed form. An extension of the model to a stochastic model with randomresource stock dynamics is obtained.

Subjects

Nash Equilibrium

Nash

Closed Form

Stochastic Model

Extraction Rate

Options

Inter- and intragenerational renewableresource extraction

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