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- Hennlock, Magnus, 1970
(författare)
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A Note on the Cost-Benefit Ratio in Self-Enforcing Agreements
- 2009
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- Since the analysis of a self-enforcing agreement by Barrett (1994) it has been clear that the ratio between the slopes of the marginal cost and marginal benefit functions is conclusive for stability of self-enforcing agreements. For example Finus and Rundshagen (1998) stated: 'it turns out that all qualitative results depend only on this ratio' as it determines the non-orthogonal free-riding response along Nash reaction functions. This note shows that this 'pure' connection between the cost-benefit ratio and non-orthogonal free-riding response occurs due to the 'anonymous contributions' property of public goods, and in such cases the cost-benefit ratio effect holds regardless the functional form of objectives, the formulation of congestion or the degree of impureness of the public good. Therefore we expect to see the cost-benefit ratio still be the conclusive component also in self-enforcing agreements based on more general functional forms than seen hitherto in the literature.
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| 3. |
- Hennlock, Magnus, 1970
(författare)
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An international marine pollutant sink in an asymmetric environmental technology game
- 2008
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Ingår i: Natural Resource Modelling. ; 21:1, s. 178-203
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Tidskriftsartikel (refereegranskat)abstract
- A differential game with N countries as players is developed for the analysis of a marine resource with open access used by the countries as a pollutant sink and for production of an ecosystem good. Consumption, investment, abatement, and environmental research sectors may differ across countries. Under the assumption that property rights are well defined within the sovereignty of each country although there is a lack of enforcement in the international area, the game is solved for the feedback Nash equilibrium, using the Isaacs–Bellman dynamic programming technique, identifying the nonlinear feedback Nash flows of consumption, investment, harvest effort, abatement, and environmental research effort in each country, which is then compared to the Pareto optimal global solution.
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| 4. |
- Hennlock, Magnus, 1970
(författare)
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Coasean Bargaining Games with Stochastic Stock Externalities
- 2006
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- The recent approach "subgame consistency" in cooperative stochastic differential games by Yeung and Petrosjan (2006) and Yeung and Petrosjan (2004) is applied to the classical Coase theorem in the presence of stochastic stock externalities. The dynamic Coasean bargaining solution is identified involving a negotiated plan of externality trade over time as well as subgame consistent Coasean liability payments flow under different assignments of property rights. The agent with the right to determine the externality has the advantage to choose his own private equilibrium as the initial condition in the dynamic system of the Coasean bargaining solution. The dynamic Coasean bargaining solution is formulated followed by an illustration showing an analytical tractable solution.
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| 7. |
- Hennlock, Magnus, 1970
(författare)
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Robust Control in Global Warming Management: An Analytical Dynamic Integrated Assessment
- 2009
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- Knightian uncertainty in climate sensitivity is analyzed in a two sectoral integrated assessment model (IAM), based on an extension of DICE. A representative household that expresses ambiguity aversion uses robust control to identify robust climate policy feedback rules that work well over IPCC climate-sensitivity uncertainty range [1]. Ambiguity aversion, together with linear damage, increases carbon cost in a similar way as a low pure rate of time preference. Secondly, in combination with non-linear damage it makes policy responsive to changes in climate data observations as it makes the household concerned about misreading sudden increases in carbon concentration rate and temper- ature as sources to global warming. Perfect ambiguity aversion results in an infinite expected shadow carbon cost and a zero carbon-intensive consumption path. Dynamic programming identifies an analytically tractable solution to the model.
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