Evolutionary Game Analysis of the Regulatory Strategy of Third-Party Environmental Pollution Management

Abstract

The “multiple-interaction” model of third-party management for environmental pollution has gradually replaced the traditional “command-and-control” model and become a new trend in governance. This new governance system is accompanied by a lack of regulatory capacity, a single reward and punishment mechanism, and frequent rent-seeking behavior, and other governance problems are becoming increasingly prominent. Based on the premise of limited rationality, considering the possible rent-seeking behavior of pollution control enterprises and professional environmental testing institutions, this paper constructs a tripartite evolutionary game model with pollution control enterprises, professional environmental testing institutions, and government regulatory departments as the main bodies. The evolutionary stabilization strategy of the three-party game is analyzed according to Lyapunov’s theory, and the system is optimized through a computational experimental simulation in MATLAB. The research results show that the government can effectively regulate the behavior of pollution control enterprises and professional environmental testing institutions by appropriately increasing the rewards and punishments, but excessive rewards are not conducive to increasing the government regulators’ own performance; the existing static reward and punishment mechanism of the government regulators fails to reward and punish the behavior of governance subjects in real time, and the linear dynamic punishment mechanism greatly increases the probability of rent-seeking behavior, neither of which is a stable control strategy for the system. The non-linear dynamic reward and punishment mechanism takes into account both dynamic incentives and dynamic constraints to make the system achieve the desired evolutionary stability strategy, i.e., pollution control enterprises follow regulations, professional environmental testing agencies refuse to seek rent, and the government actively regulates the system as the final evolutionary direction. The research findings and management implications provide countermeasures and suggestions for government regulators to improve the regulatory mechanism for the third-party management of environmental pollution.