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Evolution in time of Farsightedly Stable Coalitions: An Application of FUND

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Author Info
Dritan Osmani
Richard S.J. Tol () (Economic and Social Research Institute)

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Abstract

Game theory is used to analyze the formation and stability of coalitions for environmental protection. The paper extends further our previous research on farsightedly stable coalitions and preferred farsightedly stable coalitions (Osmani & Tol 2007a). The integrated assessment model FUND provides data for di®erent time horizons as well as the cost-bene¯t function of pollution abatement. This allows for analysis of the evolution in time of farsightedly stable coalitions and their improvement to environment and welfare. Considering multiple farsightedly stable coalitions, the participation in coalitions for environmental protection is signi¯cantly increased, which is a positive result of our game theoretical approach. But the farsighted behavior can not be sustained for a long term which implies that we can not have big coalitions for environmental protection even in "a farsighted world".

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File URL: http://www.fnu.zmaw.de/fileadmin/fnu-files/publication/working-papers/Osmani_Tol_FNU--162.pdf
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Publisher Info
Paper provided by Research unit Sustainability and Global Change, Hamburg University in its series Working Papers with number FNU-162.

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Length: 57 pages
Date of creation: May 2008
Date of revision: May 2008
Handle: RePEc:sgc:wpaper:162

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Related research
Keywords: game theory integrated assessment modeling farsighted stability coalition formation

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Find related papers by JEL classification:
C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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  1. Carraro, Carlo & Eyckmans, Johan & Finus, Michael, 2005. "Optimal Transfers and Participation Decisions in International Environmental Agreements," CEPR Discussion Papers 5046, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  2. Ioannidis, Alexis & Papandreou, Andreas & Sartzetakis, Eftichios, 2000. "International Environmental Agreements: a Literature Review," Cahiers de recherche 0008, GREEN. [Downloadable!]
  3. Chandler, P. & Tulkens, H., 1995. "The Core of an Economy with Multilateral Environmental Externalities," Papers 9550, Catholique de Louvain - Center for Operations Research and Economics.
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  4. Chander, Parkash & Tulkens, Henry, 1994. "A Core-Theoretic Solution for the Design of Cooperative Agreements on Transfrontier Pollution," Working Papers 897, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
  5. Dritan Osmani & Richard S.J. Tol, 2007. "Toward Farsightedly Stable International Environmental Agreements," Working Papers FNU-140, Research unit Sustainability and Global Change, Hamburg University, revised Jul 2007. [Downloadable!]
  6. Effrosyni Diamantoudi & Eftichios S. Sartzetakis, . "International Environmental Agreements -The Role of Foresight," Economics Working Papers 2002-10, School of Economics and Management, University of Aarhus. [Downloadable!]
  7. Santiago J. Rubio & Alistair Ulph, 2006. "Self-enforcing international environmental agreements revisited," Oxford Economic Papers, Oxford University Press, vol. 58(2), pages 233-263, April. [Downloadable!] (restricted)
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  8. Michael Finus & Ekko Ierland & Rob Dellink, 2006. "Stability of Climate Coalitions in a Cartel Formation Game," Economics of Governance, Springer, vol. 7(3), pages 271-291, August. [Downloadable!] (restricted)
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  9. Dritan Osmani & Richard S.J. Tol, 2005. "The case of two self-enforcing international agreements for environmental protection," Working Papers FNU-82, Research unit Sustainability and Global Change, Hamburg University, revised May 2006. [Downloadable!]
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  10. Parkash CHANDER & Henry TULKENS, 2006. "Cooperation, Stability and Self-Enforcement in International Environmental Agreements: A Conceptual Discussion," SCAPE Policy Research Working Paper Series 0609, National University of Singapore, Department of Economics, SCAPE. [Downloadable!]
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  11. P. Michael Link & Richard S.J. Tol, 2004. "Possible Economic Impacts of a Shutdown of the Thermohaline Circulation: an Application of FUND," Working Papers FNU-42, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2004. [Downloadable!]
  12. Dritan Osmani & Richard S.J. Tol, 2007. "Toward Farsightedly Stable International Environmental Agreements, Part two," Working Papers FNU-149, Research unit Sustainability and Global Change, Hamburg University, revised Oct 2007. [Downloadable!]
  13. Eyckmans, Johan & Tulkens, Henry, 2003. "Simulating coalitionally stable burden sharing agreements for the climate change problem," Resource and Energy Economics, Elsevier, vol. 25(4), pages 299-327, October. [Downloadable!] (restricted)
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