Land Use and Decentralized Government: A Strategic Approach for Playing a Short-Sighted Equilibrium

19 Pages Posted: 21 Feb 2019

See all articles by Maria Carmela Aprile

Maria Carmela Aprile

University Parthenope of Naples

Bruno Chiarini

University of Naples, Parthenope

Elisabetta Marzano

University of Naples Parthenope - Department of Economic Studies (DES)

Date Written: 2018

Abstract

This paper presents a simple strategic model (defined as a shortsighted game) to highlight the incentives for local governments to allow the exploitation of land in areas not suitable for such exploitation due to environmental or other risks. Municipal discretionary policy inevitably produces strategic complementarities and guides individuals to use the land (to choose the most beneficial “shortsighted” Nash equilibrium). In light of these results, it seems possible to state that the definition of non-exploitable territory and the decisions concerning it should not be left to local governments.

Keywords: land exploitation, municipal policy, strategic complementarities, myopic equilibrium

JEL Classification: C720, H310, H770, Q240

Suggested Citation

Aprile, Maria Carmela and Chiarini, Bruno and Marzano, Elisabetta, Land Use and Decentralized Government: A Strategic Approach for Playing a Short-Sighted Equilibrium (2018). CESifo Working Paper No. 7344, Available at SSRN: https://ssrn.com/abstract=3338671

Maria Carmela Aprile (Contact Author)

University Parthenope of Naples ( email )

via generale Parisi 13
via Acton 38
naples, Naples 80133
Italy

Bruno Chiarini

University of Naples, Parthenope ( email )

Via Generale Parisi 13
Napoli, 80133
Italy

Elisabetta Marzano

University of Naples Parthenope - Department of Economic Studies (DES) ( email )

via Medina 40
Naples, 80133
Italy

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