An innovative strategic choice for stakeholders in the chinese traditional commercial street renewal using evolutionary game theory

Abstract

This paper aims to solve the contradiction between the pursuit of economic interests and the protection of historical culture in the renewal of traditional Chinese commercial streets, thus coordinating the interests of the participating subjects. We construct an evolutionary game model of local government, developers, and street owners and explicitly describe the three parties' strategic choices and dynamic processes of evolution. The evolutionarily stable strategy results show that the evolutionary process by which the three parties reach a unique stable strategy set (1,1,1) is “government→developers→owners.” We use system dynamics to simulate the influence of model parameters on the dynamic evolutionary process. The specific results show that the social benefits of local government, the economic benefits of developers, and the supervision costs of street owners are the most sensitive to their respective strategic choices. The incentives and compensation measures formulated by the government can promote the active participation of the government and developers. In addition, the large fines charged by the government can also restrain the bad behavior of developers and achieve a win–win situation for the three parties.

Keywords

• urban renewal
• traditional commercial street
• innovative strategy choice
• evolutionary game
• system dynamics