A Game Theory Approach to the Analysis of Urban Power Games: Analysis of Construction Building Processes in Tehran Metropolis

Document Type : Research Paper



Game theory is an approach based on mathematics to study social interactions and modeling strategic situations. This theory focuses on decision situations where preferences of decision makers are disputed. Existence of strategic position in city also with a conflict of interest or competition makes using game theory to describe the urban management issues, attractive. One of the important controversial positions in the management of Tehran is construction of real estate sector. Construction in Tehran, not only is an important economic activity, but also is the point focus of urban development plans, and players in this sector have become one of the main and most important players in urban power in Tehran. Since the past years and to date, proceeds from the sale of excess density or in other words, and proceeds from granting licenses to rent urban land, formed the main basis of revenue of metropolis cities of the country. This study by using game theory approaches attempts strategic positioning analysis and modeling of various actors of the city. Therefore, in the first step theories of urban power has been studied and a framework is designed for modeling its components. In the second step, with the principles of game theory, the most important elements in the form of a framework are extracted for its features. In the third step, the framework of the aforementioned confronted and examined that under what condition game theory applies to the analysis of urban power. The results show that components of a play in game theory are similar to urban power components, but in terms of assumptions of game theory there is conflict between the theories of urban power. These assumptions have been examined in the two groups of rational choice and ethical choice. In a general conclusion, applications of game theory in general and specifically for urban management can be summed in the analysis of phenomena, organizational design and change in mechanisms and rules of the game. So game theory can be a new framework for analysis of urban issues and urban management decisions, but to use it, its assumptions should be noted and theories of urban power should be reviewed in those assumptions. The case of this research is analysis of urban power play between players in the process of urban construction in Tehran. This game is modeled and analyzed based on one of the most famous examples of the application of game theory which is the Prisoner's Dilemma. The results showed that the game at the current state of the theory of power in the city has two main problems. First, the cost of construction surplus into the city is not counted properly. Second, the lack of consideration the different actors (including community activists and NGOs) has caused their interests to be overlooked in the game, and municipalities and construction unilaterally, participated in the game. The rules of the game are set that the stable point of game leads to municipality earnings volatility and resulting in instability of city.


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