A unifying framework for climate cooperation: The role of technology and preferences in coalition formation

This paper develops a unifying framework for analyzing international climate cooperation by modeling technological mitigation strategies — source-based abatement and carbon removal — separately from behavioral mitigation options. Countries choose both their emissions and carbon removal efforts, weighing the consumption benefits of emissions against the costs of carbon removal and the damages from global net emissions. This framework bridges two major strands of the literature and shows that large, stable coalitions form only when deep emission reductions become individually rational—typically under net-zero conditions. The analysis demonstrates that a coalition acting as a Stackelberg leader cannot fully overcome free-riding incentives unless at least one technological option becomes sufficiently cost-effective. While greener preferences or greater awareness of climate damages can support cooperation, they cannot substitute for technological feasibility, though they can certainly complement it. Despite declining abatement costs in sectors like energy, persistent emissions in hard-to-abate industries highlight the critical need for scalable, low-cost carbon removal. Behavioral shifts can assist, particularly while technological options remain expensive. Crucially, when mitigation becomes sufficiently inexpensive, countries may achieve net-zero independently, improving global outcomes, reducing though the relative benefits of cooperation. These findings underscore that effective climate cooperation relies on technological and behavioral shifts that make deep mitigation individually optimal.