A stochastic differential game of transboundary pollution under Knightian uncertainty of stock dynamics
type: Item
instance of: scholarly article
title: A stochastic differential game of transboundary pollution under Knightian uncertainty of stock dynamics
zbMATH Open document ID: 1427.91184
DOI: 10.1155/2018/1962703
author: Chunyan Fu
author: Yongxi Yi
author: Susu Cheng
published in: Mathematical Problems in Engineering
publication date: 2019-02-08T00:00:00Z
review text: Summary: With the robust control framework of \textit{L. P. Hansen} and \textit{T. J Sargent} [``Robust control and model uncertainty'', Am. Econ. Rev. 91, No. 2, 60--66 (2001; \url{doi:10.1257/aer.91.2.60})], this paper investigates a stochastic differential game of transboundary pollution between two regions under Knightian uncertainty of stock dynamics. Both regions are assumed to play a noncooperative and a cooperative game, and the worst-case pollution accumulation processes for discrete robustness parameters are characterized. Our objective is to identify both regions' optimal output and emission levels and analyze the effects of the Knightian uncertainty of pollution stock dynamics on both regions' optimization behavior. We illustrate the results with some numerical examples.
Mathematics Subject Classification ID: 91B76
Mathematics Subject Classification ID: 91A15
zbMATH DE Number: 7018584
MaRDI profile type: Publication
full work available at URL: https://doi.org/10.1155/2018/1962703
OpenAlex ID: W2894545467
cites work: A cooperative stochastic differential game of transboundary industrial pollution
cites work: A differential game of transboundary industrial pollution with emission permits trading
cites work: Dynamically consistent cooperative solution in a differential game of transboundary industrial pollution
cites work: A cooperative stochastic differential game of transboundary industrial pollution between two asymmetric nations
cites work: Maxmin expected utility with non-unique prior
cites work: Robust control and model misspecification
description: scientific article; zbMATH DE number 7018584