IDEAS home Printed from https://ideas.repec.org/a/eee/jpolmo/v32yi1p47-63.html
   My bibliography  Save this article

Trade sanctions, financial transfers and BRIC participation in global climate change negotiations

Author

Listed:
  • Tian, Huifang
  • Whalley, John

Abstract

Two effects are at issue in evaluating country incentives to participate in global carbon emission initiatives: a utility loss from reduced consumption due to reduced use of fossil fuels and a gain from lowered temperature change. The latter accrues to all countries. Own country emissions reductions are typically not in the self interest of countries and hence countries will not participate in global climate negotiations, unless the perceived damage from climate change is very large and much larger than damage estimates in the Stern review. We use Stern based damage estimates and investigate how the incentives for large population low wage rapidly growing countries in the BRIC group (Brazil, Russia, India, China) to participate in global climate change negotiations both as a sub-global coalition and individually can be affected by penalties (tariffs) inflicted or financial transfers made to them by the OECD. We assess what levels of other country trade measures linked to non-participation are needed to induce compliance as an all or nothing discrete choice. We also analyze participation linked to financial transfers. We use a general equilibrium model calibrated to a 2006-2056 base case, and capture induced changes in the global trade equilibrium in our analyses. Our results suggest that only very high tariffs of over a hundred percent by all other countries, or even higher tariffs by the OECD alone, could induce participation by BRIC countries. Equally, large financial transfers would be needed.

Suggested Citation

  • Tian, Huifang & Whalley, John, 2010. "Trade sanctions, financial transfers and BRIC participation in global climate change negotiations," Journal of Policy Modeling, Elsevier, vol. 32(1), pages 47-63, January.
  • Handle: RePEc:eee:jpolmo:v:32:y::i:1:p:47-63
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0161-8938(09)00084-2
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Shapley, Lloyd S & Shubik, Martin, 1969. "On the Core of an Economic System with Externalities," American Economic Review, American Economic Association, vol. 59(4), pages 678-684, Part I Se.
    2. Huifang Tian & John Whalley, 2008. "China's Participation in Global Environmental Negotiations," NBER Working Papers 14460, National Bureau of Economic Research, Inc.
    3. John Whalley, 1984. "Trade Liberalization among Major World Trading Areas," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262231204, January.
    4. Herbert E. Scarf, 1965. "The Core of an N Person Game," Cowles Foundation Discussion Papers 182R, Cowles Foundation for Research in Economics, Yale University.
    5. Hirofumi Uzawa, 1999. "Global warming as a cooperative game," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 2(1), pages 1-37, March.
    6. Uzawa,Hirofumi, 2009. "Economic Theory and Global Warming," Cambridge Books, Cambridge University Press, number 9780521066594, December.
    7. Liang, Qiao-Mei & Fan, Ying & Wei, Yi-Ming, 2007. "Carbon taxation policy in China: How to protect energy- and trade-intensive sectors?," Journal of Policy Modeling, Elsevier, vol. 29(2), pages 311-333.
    8. Cai, Yuezhou & Riezman, Raymond & Whalley, John, 2013. "International trade and the negotiability of global climate change agreements," Economic Modelling, Elsevier, vol. 33(C), pages 421-427.
    9. Martin L. Weitzman, 2007. "A Review of the Stern Review on the Economics of Climate Change," Journal of Economic Literature, American Economic Association, vol. 45(3), pages 703-724, September.
    10. Partha Dasgupta, 2008. "Discounting climate change," Journal of Risk and Uncertainty, Springer, vol. 37(2), pages 141-169, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. You, Jing, 2013. "China's challenge for decarbonized growth: Forecasts from energy demand models," Journal of Policy Modeling, Elsevier, vol. 35(4), pages 652-668.
    2. Huifang Tian & John Whalley, 2010. "The Potential Global and Developing Country Impacts of Alternative Emission Cuts and Accompanying Mechanisms for the Post Copenhagen Process," NBER Working Papers 16090, National Bureau of Economic Research, Inc.
    3. Huifang Tian & Xiaojun Shi & John Whalley, 2012. "Cross Country Fairness Considerations and Country Implications of Alternative Approaches to a Global Emission Reduction Regime," NBER Working Papers 18443, National Bureau of Economic Research, Inc.
    4. Huifang Tian & John Whalley, 2015. "Developing Countries And The Unfccc Process: Some Simulations From An Armington Extended Climate Model," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 6(04), pages 1-22, November.
    5. David Ralston & Carolyn Egri & Charlotte Karam & Irina Naoumova & Narasimhan Srinivasan & Tania Casado & Yongjuan Li & Ruth Alas, 2015. "The triple-bottom-line of corporate responsibility: Assessing the attitudes of present and future business professionals across the BRICs," Asia Pacific Journal of Management, Springer, vol. 32(1), pages 145-179, March.

    More about this item

    Keywords

    BRIC group OECD GDP Model structure Sensitivity analysis;

    JEL classification:

    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jpolmo:v:32:y::i:1:p:47-63. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/505735 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.