NIMBY (not in my backyard) conflicts: a simple game-theoretic analysis

This study addresses so-called NIMBY (not in my backyard) conflicts around the siting of a facility that produces local public goods/services for the residents of one region but transfers the environmental costs to surrounding areas (subregions). Residents usually agree on the need for such a NIMBY facility but oppose its construction in their neighborhood, making the siting of the facility difficult. Assuming a region with a local government and two areas having one resident each, we formulate a two-person normal form game in which the government sites a new NIMBY facility in either of the two areas while considering the residents’ opinions on the most suitable site for the facility. Our analysis shows that in such a game, residents experience either the Prisoner’s Dilemma or War of Attrition, leading to the emergence of NIMBY conflicts.