Optimizing green building policies: a game-theory approach to regional disparities and budget constraints

The global climate crisis demands urgent interventions. Given that stimulating demand for green-rated apartments is a key strategy in advancing sustainable urban development, this study evaluates the effectiveness of three forms of government intervention—direct consumer subsidies, environmental awareness campaigns, and a mixed approach—in promoting green building (GB) adoption across central and peripheral regions under varying budget constraints. Using a game-theoretic simulation framework calibrated with real land-price data, we examine how these strategies perform under different market and fiscal conditions. Findings reveal that a regionally adjusted mixed strategy consistently outperforms across-the-board policies. Direct subsidies generate immediate GB adoption in high-price central regions, where affordability barriers dominate. In contrast, awareness efforts are more effective in peripheral areas, gradually shifting preferences where housing is more affordable but interest in GB is limited. Crucially, the mixed approach delivers both short-term impact and longer-term behavioral change, achieving broader adoption without increasing public expenditure. This finding is reinforced by game-theory principles that favor flexible, incentive-compatible allocation. Accordingly, the study recommends implementing a regionally calibrated mixed strategy that emphasizes direct subsidies in central areas and awareness campaigns in peripheral ones, especially under moderate or tight budget scenarios.