The Dynamics of Climate AgreementsBard Harstad No 1474, Discussion Papers from Northwestern University, Center for Mathematical Studies in Economics and Management Science Abstract: I provide a novel dynamic model with private provision of public bads and investments in technologies. The analysis is tractable and the MPE unique. By adding incomplete contracts, I derive implications of and for international climate treaties. While the non-cooperative equilibrium is bad, short-term agreements are worse due to hold-up problems. A long-term agreement should be more ambitious if it is rela- tively short-lasting and the technological externality large. The length itself should increase in this externality. With renegotiation, the outcome is rst best. The technological externalities are related to trade agreements, making them strategic substitutes to climate treatie Keywords: Dynamic private provision of public goods; dynamic common pool prob- lems; dynamic hold-up problems; incomplete contracts; time horizon of contracts; renegotiation design; climate change; climate agreements and trade agreements (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: http://EconPapers.repec.org/RePEc:nwu:cmsems:1474 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in Discussion Papers from Northwestern University, Center for Mathematical Studies in Economics and Management Science |
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