A Dynamic Model for Setting Railway Noise Standards

Hoepfinger, E. & von Winterfeldt, D. (1978). A Dynamic Model for Setting Railway Noise Standards. IIASA Research Memorandum. IIASA, Laxenburg, Austria: RM-78-065

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Abstract

This paper describes the application of a multistage game theoretical model to setting noise standards which is illustrated by the case of trains. The problem was structured to match the decision problem which the Environment Agency faced when setting standards for Shinkansen trains. The model considers three players: the regulator (environment agency), the producer (railway corporation), and the impactees (residents along the railway line who suffer from noise). The game has seven stages characterized by the actions of the impactees ranging from petitions to legal litigation. The final stages are the outcomes of a possible lawsuit. The case is either won by the producer or the impactees, or a compromise is reached. Transition probabilities between stages are considered parameters of the game. They depend mainly on the noise level the impactees consider acceptable, the standard set by the regulator, and the actual level of noise emitted. Only the regulator and the producer are active players in the sense that they have a set of choices characterized as standard levels (regulator) and noise protection measures (producer). The impactees are modeled as a response function. Several solutions according to a hierarchical solution concept of the game are derived. In particular, conditions are given under which the regulator or the producer would prefer a compromise solution to awaiting the outcome of the court case. These conditions can be expressed directly as functions of noise levels and transition probabilities, given some simple assumptions about the shape of the utility functions of the regulator and the producer.

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