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The Effects of the Length of the Period of Commitment on the Size of State International Environmental Agreements

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  • Bruno Nkuiya
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    Abstract

    This paper extends the standard model of self-enforcing dynamic international environmental agreements by allowing the length of the period of commitment of such agreements to vary as a parameter. It analyzes the pattern of behavior of the size of stable coalitions, the stock of pollution, and the emission rate as a function of the length of the period of commitment. It is shown that the length of the period of commitment can have very significant effects on the equilibrium. We show numerically that at the initial date, as the length of commitment is increased, the potential gain from cooperation tends to diminish, increasing the disincentive to ratify the agreements. This suggests that considerable attention should be given to the determination of the length of such international agreements.

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    File URL: https://www.create.ulaval.ca/sites/create.ulaval.ca/files/Publications/create2012-7.pdf
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    Bibliographic Info

    Paper provided by CREATE in its series Cahiers de recherche CREATE with number 2012-7.

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    Date of creation: 2012
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    Handle: RePEc:lvl:creacr:2012-7

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    Keywords: International environmental agreements; global pollution; stock pollution; dynamc games;

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    1. d'ASPREMONT, Claude & JACQUEMIN, Alexis & GABSZEWICZ, Jean J. & WEYMARK, John A., . "On the stability of collusive price leadership," CORE Discussion Papers RP -522, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Bruno Nkuiya & Walid Marrouch & Eric Bahel, 2011. "International environmental agreements under endogenous uncertainty," Working Papers e07-32, Virginia Polytechnic Institute and State University, Department of Economics.
    3. Reinganum, Jennifer F & Stokey, Nancy L, 1985. "Oligopoly Extraction of a Common Property Natural Resource: The Importance of the Period of Commitment in Dynamic Games," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 26(1), pages 161-73, February.
    4. Rubio, S. J. & Ulph, A., 2002. "An infinite-horizon model of dynamic membership of international environmental agreements," Discussion Paper Series In Economics And Econometrics 0210, Economics Division, School of Social Sciences, University of Southampton.
    5. Alistair Ulph, 2004. "Stable International Environmental Agreements with a Stock Pollutant, Uncertainty and Learning," Journal of Risk and Uncertainty, Springer, vol. 29(1), pages 53-73, 07.
    6. Carraro, Carlo & Siniscalco, Domenico, 1993. "Strategies for the international protection of the environment," Journal of Public Economics, Elsevier, vol. 52(3), pages 309-328, October.
    7. Santiago Rubio & Begoña Casino, 2005. "Self-enforcing international environmental agreements with a stock pollutant," Spanish Economic Review, Springer, vol. 7(2), pages 89-109, 06.
    8. Dockner Engelbert J. & Van Long Ngo, 1993. "International Pollution Control: Cooperative versus Noncooperative Strategies," Journal of Environmental Economics and Management, Elsevier, vol. 25(1), pages 13-29, July.
    9. Barrett, Scott, 1994. "Self-Enforcing International Environmental Agreements," Oxford Economic Papers, Oxford University Press, vol. 46(0), pages 878-94, Supplemen.
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    Cited by:
    1. Van Long Ngo, 2010. "A Survey Of Dynamic Games In Economics:," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., volume 1, number 7577.

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