Equilibrium strategies for forest restoration via an approach based on dynamic games

It is investigated whether forest restoration should be the responsibility of the forest owners or the non-owners from both social welfare and environmental perspectives. Two types of countries are considered: one where the forest owner profits from deforestation - the “deforester” - and another where the forest non-owner generates income through production – the “producer”. Both face costs due to the negative externalities caused by pollution. They participate in a non-cooperative dynamic game where the restoration efforts are alternatively carried out by either the deforester or the producer. By using the cooperative mode of play as a benchmark, the economic and environmental effects of the two non-cooperative modes are analyzed.