Transnational environmental agreements with heterogeneous actors

Abstract

This paper explores transnational environmental agreements on climate change. As the Paris agreement of 2015 contains no binding emission reduction targets for nation states, understanding other forms of cooperation as complements to the United Nations Framework Convention on Climate Change (UNFCCC) process becomes increasingly important. We thus aim to identify directions for further research on agreements with heterogeneous contracting parties. By building on empirical examples of emerging transnational environmental agreements, and on insights from the global governance literature, we discuss the scope and limits of the current economic literature on international environmental agreements. We argue that further game theoretical research would benefit from extending the analysis (i) to consider actors that are not nation state governments, and (ii) to consider multiple environmental agreements that are in force at the same time. We underpin this claim by suggesting two proposals for economic models that analyze climate clubs and city alliances. The results show that transnational environmental agreements can be individually rational and can improve the effectiveness of climate policies.

The Two-Stage Game Approach to Coalition Formation: Where We Stand and Ways to Go

“…4. As #Ŝ(m) = 2, we have #Ŝ(T i (m)) = 1, and therefore, by (13), g i (m) ≥ g i (0) = g i (T i (m)). So g i (m) ≥ g i (T i (m)).…”

“…which is an equivalence relation. 13 We refer to C ∼ C as C and C are congruent. It is clear that coalition structures C, C of N are congruent if and only if there exists a permutation π of N such that C = {π(C) | C ∈ C}.…”

“…As E ss (G) ⊆ E(G), we then have for every m ∈ E ss (G) a semi-strict equilibrium coalition structure R c (m). Property (13) implies…”

“…4 Recent applications address, e.g., agriculture [10], biodiversity conservation [11], and vaccination [12]. For further ideas for possible extensions of the model, see [13]. 5 Loosely speaking, "support" concerns the possibility for cartel games that players who do not choose for cooperation support the cooperators.…”