The Timing of Climate Agreements under Multiple Externalities

Robert Schmidt and Roland Strausz

Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems from Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: We study the potential of cooperation in global emission abatements with multiple externalities. Using a two-country model without side-payments, we identify the strategic effects under different timing regimes of cooperation. We obtain a positive complementarity effect of long-term cooperation in abatement on R&D levels that boosts potential bene?t of long-term cooperation and a redistributive effect that destabilizes long-term cooperation when countries are asymmetric. We show that whether and what type of cooperation is sustainable, depends crucially on the kind rather than on the magnitude of asymmetries.

Keywords: climate treaty; timing of cooperation; multiple externalities; long-term commitment (search for similar items in EconPapers)
JEL-codes: D62 F53 H23 Q55 (search for similar items in EconPapers)
Date: 2011-11
New Economics Papers: this item is included in nep-ene and nep-env
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Citations: View citations in EconPapers (3)

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