Ecological monsters' can be the legal outcome of rational choices made by three players: a firm, a policymaker and Nature. The firm asks the local policymaker for permission to undertake a real investment project in a stochastic framework, with real options and environmental externalities. The model consists of a non-cooperative game and its solution implies a bizarre outcome, both for the firm when it interrupts and abandons the investment project and for the policymaker when it is unable to avoid eco-monsters. Policy implications and partisan effects are explored.
G. Candela, M. Castellani, M. Mussoni (2009). Tourism investments under uncertainty: an economic analysis of ‘eco-monsters’. TOURISM ECONOMICS, 15(3), 671-688 [10.5367/000000009789036639].
Tourism investments under uncertainty: an economic analysis of ‘eco-monsters’
CANDELA, GUIDO;CASTELLANI, MASSIMILIANO;MUSSONI, MAURIZIO
2009
Abstract
Ecological monsters' can be the legal outcome of rational choices made by three players: a firm, a policymaker and Nature. The firm asks the local policymaker for permission to undertake a real investment project in a stochastic framework, with real options and environmental externalities. The model consists of a non-cooperative game and its solution implies a bizarre outcome, both for the firm when it interrupts and abandons the investment project and for the policymaker when it is unable to avoid eco-monsters. Policy implications and partisan effects are explored.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
