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Issue Linkage and Issue Tie-in in Multilateral Negotiations

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  • Paola Conconi
  • Carlo Perroni

Abstract

We describe a model of international, multidimensional policy coordination where countries can enter into selective and separate agreements with different partners along different policy dimensions. The model is used to examine the implications of negotiation tie-in - the requirement that agreements must span multiple dimensions of interaction - for the viability of multilateral cooperation when countries are linked by international trade flows and transboundary pollution. We show that, while in some cases negotiation tie-in has either no effect or can make multilateral cooperation more viable, in others a formal tie-in constraint can make an otherwise viable joint multilateral agreement unstable.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 601.

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Date of creation: 2001
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Handle: RePEc:ces:ceswps:_601

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Keywords: international cooperation; trade and environmental policy negotiations;

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References

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  1. CHANDER, Parkash & TULKENS, Henry, . "Theoretical foundations of negotiations and cost sharing in transfrontier pollution problems," CORE Discussion Papers RP, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) -983, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. Carraro, Carlo & Siniscalco, Domenico, 1991. "Strategies for the International Protection of the Environment," CEPR Discussion Papers, C.E.P.R. Discussion Papers 568, C.E.P.R. Discussion Papers.
  3. John Kennan & Raymond Riezman, 1990. "Optimal Tariff Equilibria with Customs Unions," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 23(1), pages 70-83, February.
  4. Lisandro Abrego & Carlo Perroni & John Whalley & Randall M. Wigle, 1997. "Trade and Environment: Bargaining Outcomes from Linked Negotiations," NBER Working Papers 6216, National Bureau of Economic Research, Inc.
  5. John Whalley & Colleen Hamilton, 1996. "Trading System after the Uruguay Round, The," Peterson Institute Press: All Books, Peterson Institute for International Economics, Peterson Institute for International Economics, number 62, July.
  6. Sebenius, James K., 1983. "Negotiation arithmetic: adding and subtracting issues and parties," International Organization, Cambridge University Press, Cambridge University Press, vol. 37(02), pages 281-316, March.
  7. Ray, D. & Vohra, R., 1993. "Equilibrium Binding Agreements," Papers, Boston University - Department of Economics 21, Boston University - Department of Economics.
  8. John B. Burbidge & James A. DePater & Gordon M. Myers & Abhijit Sengupta, 1996. "A Coalition-formation Approach to Equilibrium Federations and Trading Block s," Department of Economics Working Papers 1996-05, McMaster University.
  9. Kyle Bagwell & Robert Staiger, 1994. "Multilateral Tariff Cooperation During the Formation of Regional Free Trade Areas," International Trade, EconWPA 9410001, EconWPA.
  10. Giovanni Maggi, 1999. "The Role of Multilateral Institutions in International Trade Cooperation," American Economic Review, American Economic Association, American Economic Association, vol. 89(1), pages 190-214, March.
  11. Riezman, Raymond, 1985. "Customs unions and the core," Journal of International Economics, Elsevier, Elsevier, vol. 19(3-4), pages 355-365, November.
  12. Josh Ederington, 2001. "International Coordination of Trade and Domestic Policies," American Economic Review, American Economic Association, American Economic Association, vol. 91(5), pages 1580-1593, December.
  13. Abrego, Lisandro, et al, 2001. "Trade and Environment: Bargaining Outcomes from Linked Negotiations," Review of International Economics, Wiley Blackwell, vol. 9(3), pages 414-28, August.
  14. Barrett, Scott, 1994. "Self-Enforcing International Environmental Agreements," Oxford Economic Papers, Oxford University Press, vol. 46(0), pages 878-94, Supplemen.
  15. Bagwell, Kyle & Staiger, Robert W, 1997. "Multilateral Tariff Cooperation during the Formation of Free Trade Areas," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(2), pages 291-319, May.
  16. Bond, E.W. & Syropoulos, C., 1993. "Optimality and Stability of Regional Trading Blocs," Discussion Papers, Department of Economics, University of Birmingham 93-11, Department of Economics, University of Birmingham.
  17. Sang-Seung, Yi, 1996. "Endogenous formation of customs unions under imperfect competition: open regionalism is good," Journal of International Economics, Elsevier, Elsevier, vol. 41(1-2), pages 153-177, August.
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