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Coalition-proof stability of international environmental agreements

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  • Ryusuke Shinohara

    (Hosei University)

Abstract

In a Nash equilibrium of participation games in international environmental agreements, the surplus-sharing rule proposed by Eyckmans and Finus (An almost ideal sharing scheme for coalition games with externalities. FEEM Working Paper No. 155.04, 2004), Carraro et al. (Rev Int Org 1:379–396, 2006), and Weikard (Manchester Sch 77:575–593, 2009) achieves the greatest economic welfare compared with any other feasible surplus-sharing rules. In this paper, we examine the robustness of their rule to multilateral deviations by focusing on a coalition-proof Nash equilibrium. We present a condition in which the rule is welfare-optimal among the feasible surplus-sharing rules in a coalition-proof Nash equilibrium. This condition indicates that the desirability of the rule is also observable in a coalition-proof Nash equilibrium in some cases that existing studies have examined. However, in other cases, their rule may not even accomplish the existence of coalition-proof Nash equilibria. As an alternative, we provide a surplus-sharing rule to achieve an equilibrium for all possible cases.

Suggested Citation

  • Ryusuke Shinohara, 2025. "Coalition-proof stability of international environmental agreements," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 27(2), pages 169-202, April.
    • Handle: RePEc:spr:envpol:v:27:y:2025:i:2:d:10.1007_s10018-024-00426-z
    DOI: 10.1007/s10018-024-00426-z
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    Keywords

    International environmental agreements; Voluntary participation; Surplus-sharing rule; Coalition-proof Nash equilibrium; Proportional cost-sharing rule;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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