The role of uncertainty and learning for the success of international climate agreements
AbstractTransnational externalities (e.g. transboundary pollution, trade, contagious diseases and terrorism) warrant coordination and cooperation between governments, but this proves often difficult. One reason for the meager success is the public good character of many of these economic problems, encouraging free-riding. Another reason one might suspect is uncertainty, surrounding most environmental problems, and in particular climate change. This provides often an excuse for remaining inactive. Paradoxically, some recent papers have concluded just the opposite: the “veil of uncertainty” can be conducive to the success of international environmental cooperation. In this paper, we explain why and under which conditions this can be true. However, we argue that those conditions are the exception rather than the rule. Most important, we suggest a mechanism for those conditions where learning has a negative effect on the success of cooperation which removes this effect or even turns it into a positive effect. Our results apply beyond the specifics of climate change to similar problems where cooperation generates positive externalities.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Public Economics.
Volume (Year): 103 (2013)
Issue (Month): C ()
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Web page: http://www.elsevier.com/locate/inca/505578
Voluntary provision of public goods; Transnational cooperation; Self-enforcing agreements; Uncertainty; Learning;
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
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- Antoine CAZALS & Alexandre Sauquet, 2013. "When does cooperation win and why? Political cycles and participation in international environmental agreements," Working Papers halshs-00903653, HAL.
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