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Multilateral versus sequential negotiations over climate change

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  • PEREAU Jean-Christophe
  • CAPARROS Alejandro

Abstract

We discuss a model of gradual coalition formation with positive externalities in which a leading country endogenously decides whether to negotiate multilaterally or sequentially over climate change. We show that the leader may choose a sequential path, and that the choice is determined by the convexity of the TU-game and the free-rider payoffs of the followers. Except in a few clearly defined cases, the outcome of the negotiation process is always the grand coalition, although the process may need some time. This holds for the standard IEA game with heterogeneous players even if the grand coalition is not stable in a multilateral context. We also analyze the role of a facilitating agency. The agency has an incentive to speed up intra-stage negotiations and to extend the period between negotiation stages in a sequential process.

Suggested Citation

  • PEREAU Jean-Christophe & CAPARROS Alejandro, 2015. "Multilateral versus sequential negotiations over climate change," Cahiers du GREThA 2015-34, Groupe de Recherche en Economie Théorique et Appliquée.
  • Handle: RePEc:grt:wpegrt:2015-34
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    References listed on IDEAS

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    More about this item

    Keywords

    multilateral bargaining; endogenous coalition formation; international negotiations; mediator; international environmental agreements.;

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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