The urban renew case study on a feasibility profit sharing in different development intensity by game theory

There have been many urban renewal projects in Taiwan since the Urban Renewal Act issued in November 1998. Taipei is an early developed city with a large population and higher density living population in Taiwan. This will cause public safety issues as large-scale landslide disasters are caused by earthquake or fire. Hence, Taipei city government needs to promote urban renewal projects and encourage citizen participation. This research study will discuss which combination of an urban renewal project is optimal. Using game theory, this study is looking to offer a solution in a different way for the long-term problem of uneven profit distribution in an urban renewal project. In this case study, with three areas of different land development intensity and four players in this urban renewal project owing different size of the land. Among the seven different participation combinations in this project, we identify the optimal outcome for this urban renewal project using backward induction. The result shows the best outcome exists when all players cooperate, but Player D’s profit is the smallest. However, this result still shows co-partnership is more effective than the independent operation.