ScholarWorks@숙명여자대학교

초록

We utilize the public good features of Ganges water pollution clean-up and conduct a game-theoretic analysis of an economy consisting of two Indian cities, Kanpur and Varanasi, through which the Ganges flows. We show how heterogeneity in the two cities in population and the value placed on pollution clean-up determines whether clean-up ought to be centralized or decentralized. Under decentralization, in several scenarios, it is optimal for only one city to clean-up pollution. Under centralization, this exclusive clean-up of pollution is suboptimal but the amount of pollution cleaned up can be larger or smaller than the amount cleaned up under decentralization. We note the broader environmental and public health implications of pollution control and contend that the two differences between Kanpur and Varanasi and the use of majority voting are key factors to consider when pondering how much pollution to clean up in this economy and in other settings. © 2024 Economic Society of Australia, Queensland

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