Bargaining to lose the global commons

This chapter extends and generalizes previous work on the role of the state is a decision maker having the public good as an objective, replacing it by the results of a bargaining game between the state and International organizations. We provide economic models that validate the original conclusions and explore their implications for the global commons: the atmosphere, the oceans and biodiversity. Chichilnisky-Heal’s definition of a “permeable state†as a transition to a new globalized society where the sovereign state – a relatively recent creation – is receding, gives rise to a new set of global economic agents and institutions that better explain the dynamics of the global commons. We show that the permeable state complements other explanations for the resource curse as a global market failure magnified by globalization and based on the lack of well-defined property rights on natural resources during the pre-industrial period.