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The impact of the unilateral EU commitment on the stability of international climate agreements

Author

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  • BRECHET, Thierry

    (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))

  • EYCKMANS, Johan

    (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))

  • GERARD, François

    (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))

  • MARBAIX, Philippe

Abstract

In this paper we analyze the negotiation strategy of the European Union regarding the formation of an international climate agreement for the post-2012 era. We use game theoretical stability concepts to explore incentives for key players in the climate policy game to join future climate agreements. We compare a minus 20 percent unilateral commitment strategy by the EU with a unilateral minus 30 percent emission reduction strategy for all Annex-B countries. Using a numerical integrated assessment climate-economy simulation model, we find that carbon leakage effects are negligible. The EU strategy to reduce emissions by 30% (compared to 1990 levels) by 2020 if other Annex-B countries follow does not induce participation of the USA with a similar 30% reduction commitment. However, the model shows that an appropriate initial allocation of emission allowances may stabilize a larger and more ambitious climate coalition than the Kyoto Protocol in its first commitment period.

Suggested Citation

  • BRECHET, Thierry & EYCKMANS, Johan & GERARD, François & MARBAIX, Philippe, 2008. "The impact of the unilateral EU commitment on the stability of international climate agreements," CORE Discussion Papers 2008061, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvco:2008061
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    File URL: http://www.uclouvain.be/cps/ucl/doc/core/documents/coredp2008_61.pdf
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    Cited by:

    1. BRECHET, Thierry & THENIE, Julien & ZEIMES, Thibaut & ZUBER, Stéphane, 2010. "The benefits of cooperation under uncertainty: the case of climate change," CORE Discussion Papers 2010062, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Vicki Duscha & Joachim Schleich, 2013. "Can no-lose targets contribute to a 2°C target?," Climate Policy, Taylor & Francis Journals, vol. 13(3), pages 305-327, May.
    3. Thierry Brechet and Henry Tulkens, 2015. "Climate Policies: A Burden, or a Gain?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    4. Luisito Bertinelli & Amer Tabakovic & Luca Marchiori & Benteng Zou, 2015. "Transboundary Pollution Abatement: The Impact of Unilateral Commitment in Differential Games," CREA Discussion Paper Series 15-02, Center for Research in Economic Analysis, University of Luxembourg.
    5. Gregor Schwerhoff, 2013. "Leadership and International Climate Cooperation," Working Papers 2013.97, Fondazione Eni Enrico Mattei.

    More about this item

    Keywords

    climate change; coalition theory; integrated assessment model; Kyoto protocol.;

    JEL classification:

    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • H4 - Public Economics - - Publicly Provided Goods
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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