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Simulating Coalitionally Stable Burden Sharing Agreements for the Climate Change Problem

In: Public goods, environmental externalities and fiscal competition

Author

Listed:
  • Johan Eyckmans

    (Economische Hogeschool Sint-Aloysius)

  • Henry Tulkens

Abstract

The CLIMNEG world simulation (CWS) model is introduced here for simulating cooperative game theoretic aspects of global climate negotiations. The CWS model is derived from the seminal RICE model by Nordhaus and Yang [Am. Econ. Rev. 86 (1996) 741]. We first state the necessary conditions that determine Pareto efficient investment and emission abatement paths under alternative regimes of cooperation between the regions. We then show with a numerical version of the CWS model that the transfer scheme advocated by Germain, Toint and Tulkens (1997) induces an allocation in the (“gamma”) core of the world carbon emission abatement cooperative game.

Suggested Citation

  • Johan Eyckmans & Henry Tulkens, 2006. "Simulating Coalitionally Stable Burden Sharing Agreements for the Climate Change Problem," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 218-249, Springer.
    • Handle: RePEc:spr:sprchp:978-0-387-25534-7_13
    DOI: 10.1007/978-0-387-25534-7_13
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    1. Parkash Chander & Henry Tulkens, 2006. "The Core of an Economy with Multilateral Environmental Externalities," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 153-175, Springer.
    2. Marc Germain & Philippe Toint & Henry Tulkens & Aart Zeeuw, 2006. "Transfers to Sustain Dynamic Core-Theoretic Cooperation in International Stock Pollutant Control," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 251-274, Springer.
    3. Parkash Chandler & Henry Tulkens & Jean-Pascal Ypersele & Stephane Willems, 2006. "The Kyoto Protocol: An Economic and Game Theoretic Interpretation," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 195-215, Springer.
    4. Henry Tulkens, 2006. "An Economic Model of International Negotiations Relating to Transfrontier Pollution," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 107-121, Springer.
    5. Frederick Ploeg & Aart Zeeuw, 1992. "International aspects of pollution control," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(2), pages 117-139, March.
    6. Parkash Chander & Henry Tulkens, 2006. "A Core-Theoretic Solution for the Design of Cooperative Agreements on Transfrontier Pollution," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 176-193, Springer.
    7. Marc Germain & Philippe Toint & Henry Tulkens & Aart Zeeuw, 2006. "Transfers to Sustain Dynamic Core-Theoretic Cooperation in International Stock Pollutant Control," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 251-274, Springer.
    8. Nordhaus, William D & Yang, Zili, 1996. "A Regional Dynamic General-Equilibrium Model of Alternative Climate-Change Strategies," American Economic Review, American Economic Association, vol. 86(4), pages 741-765, September.
    9. Carraro, Carlo & Siniscalco, Domenico, 1993. "Strategies for the international protection of the environment," Journal of Public Economics, Elsevier, vol. 52(3), pages 309-328, October.
    10. Veijo Kaitala & Matti Pohjola & Olli Tahvonen, 1992. "Transboundary air pollution and soil acidification: A dynamic analysis of an acid rain game between Finland and the USSR," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(2), pages 161-181, March.
    11. Nick Hanley & Henk Folmer (ed.), 1998. "Game Theory and the Environment," Books, Edward Elgar Publishing, number 1083.
    12. Barrett, Scott, 1994. "Self-Enforcing International Environmental Agreements," Oxford Economic Papers, Oxford University Press, vol. 46(0), pages 878-894, Supplemen.
    13. TULKENS, Henry, 1998. "Cooperation versus free-riding in international environmental affairs: two approaches," LIDAM Reprints CORE 1339, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    14. EYCKMANS, Johan & FINUS, Michael, 2003. "Coalition formation in a global warming game : how the design of protocols affects the success of environmental treaty-making," LIDAM Discussion Papers CORE 2003088, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    15. Frederick Ploeg & Aart Zeeuw, 1992. "International aspects of pollution control," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(2), pages 117-139, March.
    16. Hackl, Franz & Pruckner, Gerald J., 2003. "How global is the solution to global warming?," Economic Modelling, Elsevier, vol. 20(1), pages 93-117, January.
    17. GERMAIN , Marc & TOINT , Philippe & TULKENS, Henry, 1997. "Financial transfers to ensure cooperative international optimality in stock pollutant abatement," LIDAM Discussion Papers CORE 1997001, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    18. Eyckmans, Johan, 1997. "Nash Implementation of a Proportional Solution to International Pollution Control Problems," Journal of Environmental Economics and Management, Elsevier, vol. 33(3), pages 314-330, July.
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