Investment projects implementation with production facilities location taking into account the environmental pollution

TL;DR

This paper develops a mathematical model for optimal placement of industrial facilities considering environmental pollution, aiming to maximize net income by balancing enterprise profits and environmental damage costs.

Contribution

It introduces a non-cooperative game model for facility location that accounts for environmental pollution and economic factors, with a numerical example demonstrating its application.

Findings

Model effectively balances economic gains and environmental costs.

Numerical example illustrates the practical application of the model.

Provides a framework for environmentally conscious investment project planning.

Abstract

When implementing an investment projects a problem of production facilities location with taking into account the environmental pollution arises. A mathematical model of the industrial enterprises location in the region is formalized and studied in this paper. It is necessary to locate objects polluting the environment in such way as to maximize the total income of the players. The total income is calculated as income from the activities of enterprises, minus the funds that are spent on the recover damage to the environment. This problem is formalized as a non-cooperative game with n players that exploit common sources -- natural objects. Numerical example is solved.