Sustainable Development and International Distribution: Theory and Application to Rainforests

Mohr, Ernst

doi:10.1111/j.1467-9396.1996.tb00093.x

Cited by 7 publications

(8 citation statements)

References 8 publications

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“…4 The concrete sharing scheme will depend on the structure of the JI/CDM project market and the bargaining power of the parties [Mohr (1996), Siniscalco, Goria and Janssen (1998) The investor could refuse the payment of the agreed funds ( S D ), whereas the host could refrain from adopting the measures required producing the emission credits (…”

Section: Contractsmentioning

confidence: 99%

“…At first glance, it seems reasonable to suppose that a modification of the static framework of the inherent long-term relationship between the sponsor and the host may alleviate the cooperation problem: Assuming a repeated interaction between both parties could create an incentive to cooperate since the long-term benefits of meeting the obligations could outweigh the short-7 See Janssen and Mohr (1998), Mohr (1996), Siniscalco, Goria and Janssen (1998). 8 Using the concept of Nash equilibrium, the possibility of renegotiations is neglected.…”

Section: )mentioning

confidence: 99%

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(Self-) Enforcement of Joint Implementation and Clean Development Mechanism Contracts

Janssen

Eni²,

Mattei³

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. A fundamental problem associated with the effectiveness and stability of international JI/CDM contracts arises from the fact that international contracts are difficult to enforce because they are made between entities that fall under the jurisdiction of distinct sovereign states. This paper investigates strategies to cope with this problem from a game theoretic perspective. Terms of use: Documents inThe first section gives a brief idea of the Kyoto Mechanisms. The second section analyses the fundamental problem of international JI/CDM contracts by modelling them as a non-cooperative, simultaneous one-shot game. The two players represent a JI/CDM project sponsor and the foreign project host that implements the JI/CDM project, respectively. It is shown that without any specific provisions against breach of contract, both JI/CDM contract parties will renege on their respective contractual obligations by behaving non-cooperatively. Consequently, the JI/ CDM project will not be realised and the associated efficiency gains are not seized.The third section analyses how to design institutions and strategies that credibly commit both JI/CDM contract parties to meet their contractual obligations by behaving cooperatively. One option for stabilising the JI/CDM contract focuses on the potential role of national environmental authorities. It is explored if they could provide a mechanism by which potential JI/CDM project sponsors could credibly commit to cooperative behaviour. IIIIt is argued that national environmental authorities indeed may serve this function by penalising breaches of JI/CDM contracts on the part of the contract party belonging to its jurisdiction. The paper derives the minimal required level of the penalty.Another option involves sequential moving on the one hand, and on the other hand strategic delegation of contract fulfilment to an agent who plays the JI/CDM game on behalf of the project host. The delegation arrangement is fixed by a binding contract between the principal, i.e. the JI/CDM project host, and an agent. The paper derives conditions that allow the implementation of the cooperative solution of the modified JI/CDM game. These conditions refer to the incentive-compatible payment to the agent.IV

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Section: Contractsmentioning

confidence: 99%

Section: )mentioning

confidence: 99%

(Self-) Enforcement of Joint Implementation and Clean Development Mechanism Contracts

Janssen

Eni²,

Mattei³

1999

SSRN Journal

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“…As the international community's willingness to pay is higher when the forested land becomes smaller, the forestry country can use its Bmarket power^to raise the per-unit compensation through a strategic deforestation behavior. Mohr [19] explained that, in this case, the credibility problem about whether the donor community is indeed Bhard nosed^about the fixed compensation can give an incentive to the recipient country to increase its deforestation rate.…”

Section: Introductionmentioning

confidence: 97%

“…In this perspective, a transfer that consists in paying a fixed price per unit of land conserved was proposed by Stähler [23], who used an optimal control approach, and by Mohr [19], in a bargaining game framework. These authors raise the point that this kind of dependency between the transfers and the forest size may, however, have adverse effects in the long run.…”

Section: Introductionmentioning

confidence: 99%

Incentive mechanisms to enforce sustainable forest exploitation

Fredj

Martín‐Herrán

Zaccour

2006

Environ Model Assess

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Using a two-player differential game approach, this paper deals with the issue of tropical deforestation. The assumption is that developing forestry countries (called the South) do not, or cannot, necessarily have the same utility for forest conservation than the developed countries (called the North). Given the global nature of the problem, we assume that it may be wise that the North offers financial support to the South to help in achieving a sustainable forest policy. We derive sustainable and short-run deforestation policies and provide a transfer mechanism which insures that the South will indeed implement the sustainable one.

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“…In this paper, we are interested in the mechanism called financial transfers, which considers aid donation and transfers as a solution for this global issue. Barbier and Rauscher [3] consider lump-sum aid donations to improve forest conservation, but this kind of transfers have been criticized as being a passive instrument to combat deforestation (see, e.g., [4,5]). A more active way would be indeed to make the amount of transfer conditional to the recipient country's effort to improve forest conservation.…”

Section: Introductionmentioning

confidence: 98%