Pooling sovereign risks: The case of environmental treaties and international debt

Mohr, Ernst; Thomas, Jonathan

doi:10.1016/s0304-3878(97)00061-8

Cited by 20 publications

(13 citation statements)

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“…In order to explain the participation levels observed in actual IEAs, for example, the Montreal Protocol, 2 static models have incorporated several features that would increase the likelihood of cooperation, including the following: Stackelberg leadership of signatories (Barrett 1994;Diamantoudi and Sartzetakis 2006;Rubio and Ulph 2006), transfers (Carraro and Siniscalco 1993;Hoel and Schneider 1997), reputation effects (Hoel and Schneider 1997;Jeppensen and Andersen 1998;Cabon-Dhersin and Ramani 2006), issue linkages (Botteon and Carraro 1998;Le Breton and Soubeyran 1997;Barrett 1997;Katsoulacos 1997;Siniscalco 1997, 1998;Mohr and Thomas 1998), including a minimum participation clause (Carraro et al 2003), and considering modest emission-reduction targets (Finus 2004).…”

Section: Introductionmentioning

confidence: 99%

A Dynamic Model for International Environmental Agreements

Breton

Sbragia

Zaccour

2009

Environ Resource Econ

109

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Section: Introductionmentioning

confidence: 99%

A Dynamic Model for International Environmental Agreements

Breton

Sbragia

Zaccour

2009

Environ Resource Econ

109

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“…Issue linkage then is a bargain on concessions in different policy fields between countries, leading to some kind of 'package deal'. Mohr and Thomas (1998) analyze the prospects of resolving the enforcement problem by issue linkage in the context of international debt and in the presence of uncertainty. 34 In their model they consider the simultaneous existence of an international environmental agreement between a state and a multilateral (or foreign) environmental agency and an existing international debt contract between the same state and a foreign lender, both of them burdened by lack of enforcement: The compliance problem in environmental agreements corresponds to the repayment risk for lenders in international loan contracts and the expropriation risk for direct investments.…”

Section: Issue Linkagementioning

confidence: 99%

Incentives for International Environmental Cooperation: Theoretic Models and Economic Instruments

Schmidt

1999

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract: This paper surveys the rapidly growing theoretical literature on international environmental agreements. The surveyed contributions are classified according to the conceivable strategies to create incentives for the participation in and compliance with environmental conventions. The proposed taxonomy of instruments consists of (i) the choice and particular form of the internalization instrument; (ii) carrot-stick strategies that make cooperative pollution reductions dependent on the past behavior of other countries (internal stabilization); (iii) transfers and sanctions of various forms (external stabilization); (iv) unilateral and accompanying measures by single countries or subcoalitions; and (v) long-term provisions to increase the flexibility of agreements and to improve the framework conditions for international negotiations. Terms of use: Documents in EconStor mayJEL−classification: D62, D7, F02, H21, Q28 Keywords: international environmental agreements, cooperation, transboundary environmental externalities, incentive compatibility, enforcement Non technical summary:Which strategies can be pursued to create incentives for international environmental cooperation? This paper addresses the above question by surveying the rapidly growing theoretical literature on international environmental agreements and by categorizing the conceivable instruments to stimulate and sustain international cooperation on transboundary pollution control. Many environmental problems share the features that a great number of countries is involved and that a substantial heterogeneity of these countries can be observed. These features make it difficult to coordinate environmental policies effectively. Firstly, when countries are very asymmetric with respect to the benefits and costs of emission abatements some of them may not profit from environmental cooperation although they contribute to pollution and therefore should be part of a cooperative solution. This holds obviously for unidirectional externalities. In such cases compensation payments to upstream countries are required which may be difficult to implement on the international level. It holds also for the case of reciprocal externalities where the additional problem arises how to allocate the measures in a way that minimizes overall abatement costs. Secondly, even in the extreme case of identical countries each government has an incentive to abstain from an agreement and to take a free ride on the efforts of ...

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“…If a country does not cooperate on the control of the environment, it looses the benefits of technological cooperation. Mohr (1995) and Mohr et al (1998) propose to link climate negotiations to international debt swaps. All these contributions have shown, from a theoretical point of view, the effectiveness of issue linkage in increasing the equilibrium number of cooperators on the provision of the public good.…”

Section: Introductionmentioning

confidence: 99%

Back to Kyoto? US Participation and the Linkage between R&D and Climate Cooperation

Buchner¹,

Carraro²,

Cersosimo³

et al. 2005

Advances in Global Change Research

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The opinions expressed in this paper do not necessarily reflect the position of Fondazione Eni Enrico Mattei Terms of use: Documents in Back to Kyoto? US Participation and the Linkage between R&D and Climate Cooperation SummaryThe US decision not to ratify the Kyoto Protocol and the recent outcomes of the Bonn and Marrakech Conferences of the Parties drastically reduce the effectiveness of the Kyoto Protocol in controlling GHG emissions. The reason is not only the reduced emission abatement in the US, but also the spillover effects on technology and countries' relative bargaining power induced by the US decision. Therefore, it is crucial to analyse whether an incentive strategy exists that could induce the US to revise their decision and to comply with the Kyoto commitments. One solution, occasionally proposed in the literature and in actual policymaking, is to link negotiations on climate change control with decisions concerning international R&D cooperation. This paper explores this idea by analysing on the one hand the incentives for EU, Japan and Russia to adopt this strategy, and on the other hand the incentives for the US to join a coalition which cooperates both on climate change control and on technological innovation. The extended regime in which cooperation takes place on both dimensions (GHG emissions and R&D) will be examined from the view point of countries' profitability and freeriding incentives. Finally, after having assessed the effectiveness and credibility of the issue linkage strategy, we explore the economic and environmental benefits of a new, recently proposed regime, which aims at achieving GHG emission control by enhancing cooperation on technological innovation and diffusion (without targets on emissions).

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Pooling sovereign risks: The case of environmental treaties and international debt

Cited by 20 publications

References 13 publications

A Dynamic Model for International Environmental Agreements

A Dynamic Model for International Environmental Agreements

Incentives for International Environmental Cooperation: Theoretic Models and Economic Instruments

Back to Kyoto? US Participation and the Linkage between R&D and Climate Cooperation

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