A game theoretical model of deforestation in human-environment relationships

We studied a two-person game regarding deforestation in human-environment relationships. Each landowner manages a single land parcel where the state of land-use is forested, agricultural, or abandoned. The landowner has two strategies available: forest conservation and deforestation. The choice of deforestation provides a high return to the landowner, but it degrades the forest ecosystem services produced on a neighboring land parcel managed by a different landowner. Given spatial interactions between the two landowners, each landowner decides which strategy to choose by comparing the expected discounted utility of each strategy. Expected discounted utility is determined by taking into account the current and future utilities to be received, according to the state transition on the two land parcels. The state transition is described by a Markov chain that incorporates a landowner's choice about whether to deforest and the dynamics of agricultural abandonment and forest regeneration. By considering a stationary distribution of the Markov chain for land-use transitions, we derive explicit conditions for Nash equilibrium. We found that a slow regeneration of forests favors mutual cooperation (forest conservation). As the forest regenerates faster, mutual cooperation transforms to double Nash equilibria (mutual cooperation and mutual defection), and finally mutual defection (deforestation) leads to a unique Nash equilibrium. Two different types of social dilemma emerge in our deforestation game. The stag-hunt dilemma is most likely to occur under an unsustainable resource supply, where forest regenerates extremely slowly but agricultural abandonment happens quite rapidly. In contrast, the prisoner's dilemma is likely under a persistent or circulating supply of resources, where forest regenerates rapidly and agricultural abandonment occurs slowly or rapidly. These results show how humans and the environment mutually shape the dilemma structure in forest management, implying that solutions to dilemmas depend on environmental properties.