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International Environmental Agreements-The Role of Foresight

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  • Effrosyni Diamantoudi

    (Department of Economics, Concordia University)

  • Eftichios S. Sartzetakis

    (Department of Economics, University of Macedonia)

Abstract

The present paper attempts to bridge the gap between the coop- erative and the non-cooperative approach employed to examine the size of stable coalitions, formed to address global environmental prob- lems. We do so by endowing countries with foresightedness, that is, by endogenizing the reaction of the coalition's members to a deviation by one member. We assume that when a country contemplates with- drawing or joining an agreement, it takes into account the reactions of other countries ignited by its own actions. We identify conditions under which there always exists a unique set of farsighted stable IEAs. The new farsighted IEAs can be much larger than those some of the previous models supported but are not always Pareto efficient.

Suggested Citation

  • Effrosyni Diamantoudi & Eftichios S. Sartzetakis, 2015. "International Environmental Agreements-The Role of Foresight," Discussion Paper Series 2015_09, Department of Economics, University of Macedonia, revised Dec 2015.
    • Handle: RePEc:mcd:mcddps:2015_09
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    References listed on IDEAS

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    More about this item

    Keywords

    International Environmental Agreements.;

    JEL classification:

    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other

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