Climis A. Davos

Cost Allocation of Multiagency Water Resource Projects: Game Theoretic Approaches and Case Study

Water resource projects are often jointly carried out by a number of communities and agencies. Participation in a joint project depends on how costs are allocated among the participants and how cost shares compare with the cost of independent projects. Cooperative N-person game theory offers approaches which yield cost allocations that satisfy rationality conditions favoring participation. A new solution concept, the normalized nucleolus, is discussed and applied to a water reuse project in southern California. Results obtained with the normalized nucleolus are compared with those derived with more traditional solution concepts, namely, the nucleolus and the Shapley value.

Siting noxious facilities with victim compensation: : n-person games under transferable utility

Abstract The siting of noxious facilities embodies the classic efficiency–equity dilemma, where efficiency tends toward centralized facilities, while equity favors completely dispersed siting schemes. Traditional prescriptions for confronting this dilemma generally focus on the issue of victim compensation . The foremost task concerns determining the proper amount of compensation to be received by host communities. In this paper, the case of transferable utility is taken up, where mechanisms for carrying out sidepayments (i.e., compensation) exist. This analysis proposes that the siting problem is best handled as an allocation game for which methods from n-person cooperative game theory are well suited. This new approach addresses a long-standing need for a rigorous framework within which solutions based on principles of equity can be formulated. The kinds of outcomes generated by this new analytic stands in contrast to, and underscores the serious inadequacies of, traditional, often ad hoc prescriptions for solving the siting game. For one thing, the analysis suggests that the traditional formula, that of transferring utility so as to bring all players to the point of Pareto efficiency, undercompensates victims. In short, without a framework such as proposed herein, stakeholders may find themselves debating proposed solutions that ultimately violate basic notions of equity and, so, fail to engender cooperative modes of behavior needed for sustainable solutions. In fact, traditional notions of compensation, by violating the so-called core constraints, may give players inherent incentive to defect from cooperative agreements. Given this condition, it should come as no surprise that the outcome of many negotiations is terminal impasse.

Sustainable cooperation as the challenge for a new coastal management paradigm

Coastal management is a collective action. As such, it depends for its effective implementation on the cooperation of a multitude of stakeholders, i.e. civic organizations, economic interest groups, environmental groups, governmental agencies, scientists and other individuals. Where ‘effective implementation’ implies the achievement of targeted objectives within targeted time horizons and ‘cooperation’ connotes that stakeholders elect to pursue cooperative strategies that may yield higher gains for all stakeholders instead of competitive strategies that may maximize individual benefits. Thus, the fundamental challenge of Coastal Zone Management (CZM) is to maximize the effectiveness of this management by maximizing and sustaining stakeholder cooperation. I submit that sustainable cooperation can be maximized and nurtured for its voluntariness only by a process-oriented, cooperative CZM. The alternative, outcome-oriented, normative CZM can force, directly or indirectly, cooperation but it cannot sustain it. My purpose in this paper, is to highlight arguments supporting this view as well as the analytical challenges of cooperative ICZM. Certain points are also viewed in the light of preliminary findings of a research project designed to probe these challenges.

Public priorities for evaluating air quality management measures

The results of a pilot study of the priorities that concerned parties assign to a number of criteria for evaluating air quality management measures (AQMM) are reported. The analysed priorities were those of the members of: (a) two task forces appointed to assist the implementation of the Air Quality Management Plan of the South Coast Air Quality Management District of California; and (b) the gallery , during the meetings of these task forces. Major findings include: (a) that there is not a single criterion that predominates; (b) the concern that supports the legal requirement for an almost exclusive economic efficiency valuation is not shared by the public; (c) concerned parties with similar special interest affiliations and expertise hold statistically different priorities; and (d) distinct patterns of priorities exist necessitating separate evaluations of AQMM in order better to understand the reasons for support (opposition) of each measure and the strength of this support. An important consequence of these findings is that no charge that air quality management decisions may cater to special interests can be supported. Hence, the challenge emerges for all concerned parties to determine the factors, other than those associated with conventional special interest labels, which actually influence public values regarding air quality management.

Global environmental management

Abstract The thesis is advanced that global environmental management will become praxis only with research by an internationally respected center leading to effective conflict management and, thus, to international cooperation in the search for solutions and implementation of policies. Two levels of such research are suggested and broadly defined: macro and micro. The relevance and contributions of experiences with local environmental conflict management are also discussed.

The entropic indeterminateness of public interest: Case study of organized interest in electric power plant siting and technology options

Abstract The fundamental premise of this paper is that the integration of public values into collective action and policy must be based on a study of the public interest as an entropic process. To perform such a study, willingness-to-compromise and consistency of values are characterized as analogous to the concept of entropy. Hence high entropy is taken to imply unwillingness-to-compromise and consistency of values while low entropy to indicate that public values are in a state of flux. The assessment of the need for entropy reversal and the assessment of the entropic indeterminateness are suggested as focal points of research. A methodology is suggested and tested through the case study. Findings from the case study are also interpreted as illuminating the contributions of the approach and providing supportive arguments for a participatory, systematic, anticipatory and qualitative study of policy options and public values.

A pollution theory of value

Abstract Environmental policies in effect add polluting emissions to the list of societys limited resources. As a consequence, they necessitate the estimation of a new system of values that will relate social ends and economic activities in a regime of optimum resource allocation. The purpose for formulating the theory presented in this paper is to illuminate the nature and assist the determination of these values when emissions are regulated. In discussing the theorys contributions, I place emphasis not on the normative properties of the theory but rather on the potentials it offers for an integrated environmental policy evaluation within a social context. The theory is founded on the concept of productive efficiency and the related concept of accounting prices for resources and for the products of resource utilization.

Public priorities for efficiency in air quality management

The results of a pilot study of the priorities that concerned parties assigned to efficiency attributes of air quality management measures are reported. The analysed priorities were those of the members of: (a) two task forces appointed to assist the South Coast Air Quality Management District of California evaluate alternative measures; and (b) the gallery , during the task force meetings. Major findings include: (a) a great majority of concerned parties assigned a more than two-times greater priority to the beneficial impacts of measures than to the negative impacts; (b) concerned parties with the highest priority for the beneficial impacts appear to disagree on the priority of specific categories of these impacts; (c) concerned parties with similar special interest affiliations and expertises hold statistically different priorities; and (d) distinct patterns of priorities exist necessitating separate efficiency assessments of measures in order to better understand the reasons for support (opposition) of each measure and the strength of this support. According to these findings, even when efficiency is chosen as the only criterion, a more involved process is needed than a pecuniary benefit-cost analysis. The objective of this process should be a multi-attribute evaluation of air quality management measures with the proactive participation of interested parties. Only such a process can assist conflict management and a more efficacious implementation of decisions.

Public values for equity in air quality management

The results of a pilot study of public values regarding the criterion of equity for air quality management are reported. Values refer to: (a) the priority assigned to equity attributes; and (b) the strength of preference for potential attribute levels. The public for this study was comprised of: (a) the members of two task forces appointed to assist the South Coast Air Quality Management District of California evaluate alternative air quality management measures, and (b) the gallery present during the task force meetings. Major findings include: (a) the concern with the equity of the impact distribution of measures among socio-economic groups is significantly higher to that among counties; (b) the concern with the equity of employment impact distributions is even higher than that of the next value of all impacts for a large number of the study participants; (c) there exist two groups of participants with opposing strong views regarding the priority of all equity attributes defined by the study; (d) there is no unanimous agreement on a monotonically increasing preference for higher equity levels; and (e) the lack of agreement among participants declaring similar interest and expertise affiliations. These findings call for a participatory multi-attribute evaluation of the equity of air quality management measures which will facilitate conflict management and thus a more efficacious implementation.

Energy use management: The critical issues of interdependency and indeterminateness

Abstract The translation of energy concerns into effective policies under a democratic regime is currently impaired by two interrelated factors: (1) the interdependency of energy goals with most of societys other concerns and (2) the indeterminateness of both the scientific evidence and public interest. Some of the manifestations of the failure to address these factors are the prevailing energy policy uncertainties and the polarization of values, issues and research efforts. Awareness of this reality has not prevented, however, the suggestion of policies the majority of which either neglect the synergistic effect of the factors or depend for their legitimization on principles incompatible with democratic decision-making. I suggest that systematic examination of the web of interdependencies and of the scientific and public interest indeterminateness supports the assertion that the effectiveness of energy use management will depend on: (i) supplementing quantitative research with qualitative evaluation of scientific and public values; (ii) synthesizing the findings of the numerous currently performed analyses; and (iii) substituting the paternalistic dictates of scientists and special interest groups as the basis for policy decision-making with a participatory process that will aim to maximize the accord among all interested in, and/or impacted by, energy policies.