Abstract
Almost all international environmental agreements include a minimum participation rule. Under such rule an agreement becomes legally binding if and only if a certain threshold in terms of membership or contribution is reached. We analyse a cartel game with open membership and heterogeneous countries to study the endogenous choice of a minimum participation rule and its role for the success of international environmental agreements. While a full participation requirement would be efficient, we find (sequential) equilibria with a minimum participation rule that allows at least one country to free ride. Free riding may occur if a country can exploit some bargaining power in the negotiation of the minimum participation rule.
Original language | English |
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Pages (from-to) | 711-727 |
Journal | Environmental and Resource Economics |
Volume | 62 |
Issue number | 4 |
DOIs | |
Publication status | Published - 1 Dec 2015 |
Keywords
- Coalition formation
- Environmental policy coordination
- International environmental agreements
- Minimum participation rules
- Transboundary pollution