Measures to enhance the success of global climate treaties |
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Authors: | Johan Eyckmans Michael Finus |
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Institution: | 1.EHSAL, Europese Hogeschool Brussel,Brussels,Belgium;2.Centrum voor Economische Studi?n, K.U. Leuven,Leuven,Belgium;3.Department of Economics,University of Hagen,Hagen,Germany |
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Abstract: | We analyze important forces that hamper the formation of successful self-enforcing agreements to mitigate global warming from
an economic point of view. The analysis combines two modules: (a) an integrated assessment model that captures the feedback
between the economy, environmental damages and the climate system and (b) a game theoretic model that determines stable coalitions
in the presence of free-riding incentives. We consider two types of measures to enhance the success of international environmental
treaty-making: (a) transfers, aiming at balancing asymmetric gains from cooperation; (b) institutional changes, aiming at
making it more difficult to upset stability of a treaty. We find that institutional changes may be as important as transfers
and should therefore receive more attention in future international negotiations.
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Keywords: | Coalition formation Design of climate treaty protocol Integrated assessment model Non-cooperative game theory |
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