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Posted: 9/28/2013 3:46:58 PM EDT

Posted this in GD also, but I figured it might get more serious responses over here...







I'm a grad student studying water resource management, emphasizing policy aspects of urban hydraulic reach--the phenomenon where cities appropriate water from rural areas in order to enable continued economic growth. In particular, I'm looking at a new reservoir proposal (Lake Ralph Hall), which is viewed by some DFW-area towns as an urgent water resource priority, while being vehemently opposed by other suburbs (particularly Flower Mound and Coppell).



I've been working on my research proposal, which has been going slowly. My research question in its most simple form is: "will current TX water policy constrain future growth?" What I'm looking at is risk management and planning at different scales. A city is going to have different priorities than the state, since the latter is accountable to all Texans, not just the urban ones (a state water administrator has to think about the needs of agriculture, for example). My hypothesis is that these differing agendas actually work against each other in a way that might seriously jeopardize long term (100-200 years) economic growth and resilience for the whole state.




What I've been missing is a way to analyze the question and test the hypothesis. TX surface water rights are based on prior appropriation--whoever puts the water to productive use first gets it. And water rights are fully marketized, that is, they can be bought and sold. Municipal water supply is planned and administered in a multi-tier hierarchy: state>region>wholesale>retail. Though linked, each scale has to develop its own strategies in order to meet its future needs. So the system is both competitive and collaborative. I've been needing a way to analyze that before even beginning to collect data. Then, while sitting around talking to myself the other night, it hit me--these are all components of game theory: competition/collaboration, strategies/payoffs, availability of information, and systemic structure.




The thing is, I know very little about game theory other than the broad "for dummies" strokes. Pareto-optimization and Muir equilibria? WTF are those? Just working my way through the wiki article took me a couple of hours. So what I'm looking for are good introductory resources. I don't need the mathematical modeling details yet--just a good working understanding of how game theory works, and how I can put it to use.




Does anyone have any suggestions?
Link Posted: 12/2/2013 8:57:23 AM EDT
[#1]
A Pareto efficient allocation, or Pareto optimum, is an allocation such that no one can be made better off without making someone else worse off. A Pareto improvement is a change in the allocation which makes everyone better off, without making anyone worse off.



I have no idea what a Muir equilibrium is.



Game theory at it's "basic level" is quite simple and easy to learn. More advanced game theory is dreadfully hard. You should focus on resources designed for applied economists (i.e. the guys who do empirical work), as they don't really care about learning the brutally difficult intricacies of pure game theory as even simple game theory is nearly impossible to estimate empirically. Game theory can also be very math heavy. How is your math background?
Link Posted: 12/2/2013 12:39:13 PM EDT
[#2]
Muir was an error--I was referring to Nash.  Part of the study will be determining whether the players tend towards Nash-type best responses, based on their perceptions of the resource game (one-shot vice repeating, open v closed info, etc.).  



As the proposal has developed, GT has become more a way to schematize the research rather than an active attempt to predictively model--as you point out, the math is just prohibitive for me.  I'm picking up a bit of calculus through my hydrology courses, but I just don't have the math to really pursue this quantitatively.  So even though I would be far more comfortable with statistical methods, this is going to be qualitative research (ugh!).




Based on the responses in the GD thread, I'm making my way through the Binmore intro text, as well as the Yale online course.
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