Multi-objective Stackelberg Game Between a Regulating Authority and a Mining Company: A Case Study in Environmental Economics

Bilevel programming problems are often found in practice. In this paper, we handle one such bilevel application problem from the domain of environmental economics. The problem is a Stakelberg game with multiple objectives at the upper level, and a single objective at the lower level. The leader in this case is the regulating authority, and it tries to maximize its total tax revenue over multiple periods while trying to minimize the environmental damages caused by a mining company. The follower i...