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Inequality, Communication and the Avoidance of Disastrous Climate Change

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  • Alessandro Tavoni

    () (Grantham Research Institute, London School of Economics)

  • Astrid Dannenberg

    (Centre for European Economic Research, Mannheim, Germany)

  • Giorgos Kallis

    () (ICTA, Universidad Autonoma de Barcelona)

  • Andreas Lšschel

    (Centre for European Economic Research, Mannheim, Germany)

Abstract

International efforts to provide global public goods often face the challenges of coordinating national contributions and distributing costs equitably in the face of uncertainty, inequality, and free-riding incentives. In an experimental setting, we distribute endowments unequally among a group of people who can reach a fixed target sum through successive money contributions, knowing that if they fail they will lose all their remaining money with 50% probability. We find that inequality reduces the prospects of reaching the target, but that communication increases success dramatically. Successful groups tend to eliminate inequality over the course of the game, with rich players signalling willingness to redistribute early on. Our results suggest that coordinative institutions and early redistribution from richer to poorer nations may widen our window of opportunity to avoid global climate calamity.

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File URL: http://ccep.anu.edu.au/data/2011/pdf/wpapers/CCEP1103Tavoni.pdf
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Bibliographic Info

Paper provided by Centre for Climate Economics & Policy, Crawford School of Public Policy, The Australian National University in its series CCEP Working Papers with number 1103.

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Date of creation: Mar 2011
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Handle: RePEc:een:ccepwp:1103

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Cited by:
  1. Dannenberg, Astrid & Löschel, Andreas & Paolacci, Gabriele & Reif, Christiane & Tavoni, Alessandro, 2011. "Coordination under threshold uncertainty in a public goods game," ZEW Discussion Papers 11-065, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  2. Brekke, Kjell Arne & Konow , James & Nyborg, Karine, 2012. "Cooperation Is Relative: Income and Framing Effects with Public Goods," Memorandum 16/2012, Oslo University, Department of Economics.
  3. Simon Dietz & Carmen Marchiori & Alessandro Tavoni, 2012. "Domestic Politics and the Formation of International Environmental Agreements," Working Papers 2012.76, Fondazione Eni Enrico Mattei.
  4. Peter H. Kriss & George Loewenstein & Xianghong Wang & Roberto A. Weber, 2011. "Behind the veil of ignorance: Self-serving bias in climate change negotiations," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 6(7), pages 602-615, October.
  5. Karen Pittel & Dirk Rübbelke, 2011. "International Climate Finance and its Influence on Fairness and Policy," Working Papers 2011-04, BC3.

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