Thursday, March 15, 2007

Lempert and Schwabe - Transition to Sustainable Waste Management

Another RAND monograph, but this one deals with an application of gaming techniques to a domestic public policy question (available in pdf form here). The goal was to investigate what factors might turn out to be important in the shift from a product packaging industry that primarily used "virgin" materials and generated large amounts of solid waste to a system based on recycling of packaging material. Participants from government and industry were assigned roles within the context of a model, and were asked to make decisions on investment or regulation related to packaging. Based on these decisions, the model then worked out the market clearing prices and quantities for each type of product or service, established profits and losses for the simulated activities, and presented the results to the participants for another round of regulation and investment.

This paper provides a detailed look at the way a model can provide the structure for a game, as well as showing the value added that gaming out a model can produce.

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