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The Stability and Effectiveness of Climate Coalitions: A Comparative Analysis of Multiple Integrated Assessment Models

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  • Lessmann, Kai
  • Kornek, Ulrike
  • Dellink, Rob
  • Emmerling, Johannes
  • Eyckmans, Johan
  • Nagashima, Miyuki
  • Weikard, Hans-Peter
  • Yang, Zili

Abstract

In this paper we report results from a comparison of numerically calibrated game theoretic integrated assessment models that explore stability and performance of international coalitions for climate change mitigation. Specifically, by means of this ensemble of models we are able to identify robust results concerning incentives of nations to commit themselves to a climate agreement, and to estimate what stable agreements can achieve in terms of greenhouse gas mitigation. We also assess the potential of transfers that redistribute the surplus of cooperation in order to foster stability of climate coalitions. In contrast to much of the existing analytical game theoretical literature, we find substantial scope for self-enforcing climate coalitions in most models that close much of the abatement and welfare gap between complete absence of cooperation and full cooperation. This more positive message follows from the use of transfer schemes that are designed to counteract free riding incentives.

Suggested Citation

  • Lessmann, Kai & Kornek, Ulrike & Dellink, Rob & Emmerling, Johannes & Eyckmans, Johan & Nagashima, Miyuki & Weikard, Hans-Peter & Yang, Zili, 2014. "The Stability and Effectiveness of Climate Coalitions: A Comparative Analysis of Multiple Integrated Assessment Models," Climate Change and Sustainable Development 163598, Fondazione Eni Enrico Mattei (FEEM).
    • Handle: RePEc:ags:feemcl:163598
    DOI: 10.22004/ag.econ.163598
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    Cited by:

    1. Yang, Zili, 2019. "Increasing returns to scale in energy-intensive sectors and its implications on climate change modeling," Energy Economics, Elsevier, vol. 83(C), pages 208-216.
    2. Anil Markandya & Enrica Cian & Laurent Drouet & Josué M. Polanco-Martínez & Francesco Bosello, 2019. "Building Risk into the Mitigation/Adaptation Decisions simulated by Integrated Assessment Models," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(4), pages 1687-1721, December.
    3. Bakalova, Irina & Eyckmans, Johan, 2019. "Simulating the impact of heterogeneity on stability and effectiveness of international environmental agreements," European Journal of Operational Research, Elsevier, vol. 277(3), pages 1151-1162.
    4. Jasper N. Meya & Ulrike Kornek & Kai Lessmann, 2018. "How empirical uncertainties influence the stability of climate coalitions," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 18(2), pages 175-198, April.
    5. Eric Bahel, 2018. "Cooperation and Subgame Perfect Equilibria in Global Pollution Problems with Critical Threshold," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 70(2), pages 457-481, June.
    6. Zili Yang, 2016. "Mitigation Cost And Climate Damage Versus Incentive Shifts Of Climate Coalition," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 7(04), pages 1-24, November.
    7. Alban Thomas & Vera Zaporozhets, 2017. "Bargaining Over Environmental Budgets: A Political Economy Model with Application to French Water Policy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(2), pages 227-248, October.
    8. Acocella, Nicola & Di Giovanni, Tomasz, 2019. "Natural Resources and Environment Preservation: Strategic Substitutability vs. Complementarity in Global and Local Public Good Provision," International Review of Environmental and Resource Economics, now publishers, vol. 13(3-4), pages 203-227, September.
    9. KORNEK, Urik & LESSMANN, Kai & TULKENS, Henry, 2014. "Transferable and non transferable utility implementations of coalitional stability in integrated assessment models," LIDAM Discussion Papers CORE 2014035, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).

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    Keywords

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    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

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