Global Environmental Management: Incentives for Abatement Investment Anticipating an International Bargaining
When future international agreement for global environmental control is anticipated, decicions for controlling current carbon gas emissions by improving the country's abatement capabilities are strongly affected by the likelihood of and the likely outcome of such agreements. We construct a two period two country model where the quality of the atmospheric environment is a global public capital, and countries invets in abatement investments in the first period and engage in production activities in the second period.
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