Uncertainty and climate treaties: Does ignorance pay?

R.B. Dellink, M. Finus

Research output: Contribution to journalArticleAcademicpeer-review

10 Citations (Scopus)

Abstract

Uncertainty and learning play an important role in the management of many environmental and resource problems and in particular in climate change. In stylized game-theoretic models of international environmental treaty formation, which capture the strategic interactions between nations, learning usually has a negative impact on the success of cooperation. We use a richer climate model that captures the large heterogeneity between different world regions and considers uncertainty about the benefits and costs from climate mitigation. By explicitly exploiting differences between regions and allowing transfers to mitigate free-rider incentives, we derive much more positive conclusions about the role of learning.
Original languageEnglish
Pages (from-to)565-584
JournalResource and Energy Economics
Volume34
Issue number4
DOIs
Publication statusPublished - 2012

Keywords

  • international environmental agreements
  • stability likelihood
  • irreversibility
  • strategies
  • coalitions
  • emissions
  • model

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