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Participation in International Environmental Agreements: The Role of Timing and Regulation

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Author Info

  • Michael Finus

    (University of Hagen)

  • Bianca Rundshagen

    (University of Hagen)

Abstract

We analyze the formation of self-enforcing international environmental agreements under the assumption that countries announce their participation either simultaneously or sequentially. It is shown that a sequential formation process opens up possibilities for strategic behavior of countries that may lead to inferior outcomes in terms of global abatement and welfare. We then analyze whether and under which conditions a regulator like an international organization, even without enforcement power, can improve upon globally suboptimal outcomes through coordination and moderation, given that recommendations must be Pareto-improving to all parties.

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Bibliographic Info

Paper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2005.45.

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Date of creation: Mar 2005
Date of revision:
Handle: RePEc:fem:femwpa:2005.45

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Keywords: International environmental agreements; Timing of participation decision; Coalition theory; Role of international regulator;

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References

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  1. GERMAIN, Marc & TOINT, Philippe & TULKENS, Henry & DE ZEEUW, Aart, . "Transfers to sustain dynamic core-theoretic cooperation in international stock pollutant control," CORE Discussion Papers RP -1637, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. Chander, Parkash & Tulkens, Henry, 1994. "The Core of an Economy With Multilateral Environmental Externalities," Working Papers 886, California Institute of Technology, Division of the Humanities and Social Sciences.
  3. Effrosyni Diamantoudi & Eftichios S. Sartzetakis, 2006. "Stable International Environmental Agreements: An Analytical Approach," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 8(2), pages 247-263, 05.
  4. Santiago Rubio & Alistair Ulph, 2003. "An Infinite-Horizon Model of Dynamic Membership of International Environmental Agreements," Working Papers 2003.57, Fondazione Eni Enrico Mattei.
  5. Carraro, Carlo & Siniscalco, Domenico, 1991. "Strategies for the International Protection of the Environment," CEPR Discussion Papers 568, C.E.P.R. Discussion Papers.
  6. Debraj Ray & Rajiv Vohra, 1996. "A Theory of Endogenous Coalition Structure," Papers 0068, Boston University - Industry Studies Programme.
  7. Michael Hoel, 1992. "International environment conventions: The case of uniform reductions of emissions," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 2(2), pages 141-159, March.
  8. Petrakis, Emmanuel & Xepapadeas, Anastasios, 1996. "Environmental consciousness and moral hazard in international agreements to protect the environment," Journal of Public Economics, Elsevier, vol. 60(1), pages 95-110, April.
  9. Hart, Sergiu & Kurz, Mordecai, 1983. "Endogenous Formation of Coalitions," Econometrica, Econometric Society, vol. 51(4), pages 1047-64, July.
  10. Bloch, Francis, 1996. "Sequential Formation of Coalitions in Games with Externalities and Fixed Payoff Division," Games and Economic Behavior, Elsevier, vol. 14(1), pages 90-123, May.
  11. Michael Hoel & Kerstin Schneider, 1997. "Incentives to participate in an international environmental agreement," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 9(2), pages 153-170, March.
  12. Michael Finus & Pierre v. Mouche & Bianca Rundshagen, 2005. "Uniqueness of Coalitional Equilibria," Working Papers 2005.23, Fondazione Eni Enrico Mattei.
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Cited by:
  1. Michael Finus & Bianca Rundshagen & Johan Eyckmans, 2009. "Simulating a Sequential Coalition Formation Process for the Climate Change Problem: First Come, but Second Served?," Working Papers 2009.109, Fondazione Eni Enrico Mattei.
  2. Arthur Caplan & Emilson Silva, 2002. "An Equitable, Efficient and Implementable Scheme to Control Global Carbon Dioxide Emissions," Working Papers 2002-22, Utah State University, Department of Economics.

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