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Simulating coalitionally stable burden sharing agreements for the climate change problem

  • EYCKMANS, Johan
  • TULKENS, Henry

In this paper we test empirically with the Nordhaus and Yang (1996) RICE model the core property of the transfer scheme advocated by Germain, Toint and Tulkens (1997). This scheme is designed to sustain full cooperation in a voluntary internationalenvironmental agreement by making all countries at least as well off as theywould be by joining coalitions adopting emission abatement policies that maximize their coalition payoff; under the scheme no individual country, nor any subset of countries would have an interest in leaving the international environmental agreement. The simulations show that the transfer scheme yields an allocation in the core of the carbon emission abatement game associated with the RICE model. Finally, we discuss some practical implications of the transfer scheme for current climate negotiations.

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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 1999026.

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Date of creation: 01 Apr 1999
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Handle: RePEc:cor:louvco:1999026
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  1. CHANDER, Parkash & TULKENS, Henry, 1994. "A Core-Theoretic Solution for the Design of Cooperative Agreements on Transfrontier Pollution," CORE Discussion Papers 1994048, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. Eyckmans, Johan, 1997. "Nash Implementation of a Proportional Solution to International Pollution Control Problems," Journal of Environmental Economics and Management, Elsevier, vol. 33(3), pages 314-330, July.
  3. Michael Hoel, 1992. "International environment conventions: The case of uniform reductions of emissions," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 2(2), pages 141-159, March.
  4. Johan Eyckmans & Michael Finus, 2003. "Coalition Formation in a Global Warming Game: How the Design of Protocols Affects the Success of Environmental Treaty-Making," Energy, Transport and Environment Working Papers Series ete0317, Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment.
  5. CHANDER, Parkash & TULKENS, Henry, 1995. "The Core of an Economy with Multilateral Environmental Externalities," CORE Discussion Papers 1995050, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  6. Parkash Chander & Henry Tulkens & Jean-Pascal van Ypersele & Stephane Willems, 1999. "The Kyoto Protocol: An Economic and Game Theoretic Interpretation," CESifo Working Paper Series 229, CESifo Group Munich.
  7. Hackl, Franz & Pruckner, Gerald J., 2003. "How global is the solution to global warming?," Economic Modelling, Elsevier, vol. 20(1), pages 93-117, January.
  8. van der Ploeg, F. & de Zeeuw, A.J., 1990. "International aspects of pollution control," Discussion Paper 1990-65, Tilburg University, Center for Economic Research.
  9. Carraro, Carlo & Siniscalco, Domenico, 1991. "Strategies for the International Protection of the Environment," CEPR Discussion Papers 568, C.E.P.R. Discussion Papers.
  10. Kaitala, Veijo & Pohjola, Matti & Tahvonen, Olli, 1990. "Transboundary Air Pollution and Soil Acidification: A Dynamic Analysis of an Acid Rain Game between Finland and the USSR," Discussion Papers 344, The Research Institute of the Finnish Economy.
  11. GERMAINÂ , Marc & TOINTÂ , Philippe & TULKENS, Henry, 1997. "Financial transfers to ensure cooperative international optimality in stock pollutant abatement," CORE Discussion Papers 1997001, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  12. Barrett, Scott, 1994. "Self-Enforcing International Environmental Agreements," Oxford Economic Papers, Oxford University Press, vol. 46(0), pages 878-94, Supplemen.
  13. Germain, M. & Toint, Ph. & Tulkens, H. & de Zeeuw, A.J., 2003. "Transfers to sustain dynamic core-theoretic cooperation in international stock pollutant control," Other publications TiSEM 8953bc6e-fc65-4fd7-a2d1-6, Tilburg University, School of Economics and Management.
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