The strategic role of adaptation in international environmental agreements

Anna Viktoria Rohrer and Santiago Rubio

Journal of Environmental Economics and Management, 2024, vol. 124, issue C

Abstract: This paper investigates the impact of the timing of adaptation on the stability of international environmental agreements (IEAs) for different levels of cooperation. This issue is addressed by solving a three-stage coalition formation game in a Nash-Cournot setting. In the first stage, countries decide non-cooperatively on their participation in an IEA. Then, depending on the timing, countries decide on adaptation and emissions in the second and third stage. The game is solved for three levels of cooperation. Countries can either cooperate on emissions (emission agreement), on adaptation (adaptation agreement), or both actions (complete agreement). When emissions are chosen first, this extension to an emission–adaptation game is a generalization of the pure emission game. However, when adaptation is chosen first, the grand coalition is stable, provided that countries sign a complete agreement. With partial cooperation, stable coalitions are small. The results establish a connection between the strategic role of adaptation, the levels of adaptation of non-signatories and signatories for the different types of agreements and the participation in an IEA. Moreover, the results indicate that the grand coalition is stable even when it significantly enhances net benefits.

Keywords: International environmental agreements; Emission–adaptation game; Prior commitment; Strategic effects; Participation; Effectiveness of adaptation (search for similar items in EconPapers)
JEL-codes: D62 F53 H41 Q54 (search for similar items in EconPapers)
Date: 2024
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Working Paper: The Strategic Role of Adaptation in International Environmental Agreements (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:124:y:2024:i:c:s0095069624000123

DOI: 10.1016/j.jeem.2024.102938

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