Cooperative Management of Invasive Species: A dynamic Nash bargaining approach

Invasive species cause billions of dollars in damages in the US and world and span all types 
of land and water resources. Not surprisingly, there are several examples of 
intergovernmental cooperation to stem the spread of invasives. We present a simple yet 
dynamic model of bilateral bargaining where municipalities bargain over a payment from the 
uninfested municipality to an infested municipality that compensates the latter to undertake 
greater control that slows the probability of invasive species spread. In an application to the 
problem of Emerald Ash Borer infestation in Minneapolis and St. Paul, Minnesota, we find 
support for bilateral bargaining when the uninfested municipality has a significant bargaining 
power advantage over the infested municipality. However, our results also suggest that in 
many instances, a short-term bargaining agreement is unlikely to succeed, which suggests a 
potential role for higher levels of government to play in facilitating long-term bargaining 
agreements even when the details of those agreements are left to the municipalities to 
negotiate. 

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