Minimum Participation Rules with Heterogeneous Countries

Hans Peter Weikard*, Leo Wangler, Andreas Freytag

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

17 Citations (Scopus)

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 languageEnglish
Pages (from-to)711-727
JournalEnvironmental and Resource Economics
Volume62
Issue number4
DOIs
Publication statusPublished - 1 Dec 2015

Keywords

  • Coalition formation
  • Environmental policy coordination
  • International environmental agreements
  • Minimum participation rules
  • Transboundary pollution

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