The Stackelberg vs. Nash-Cournot Folk-theorem in international environmental agreements

Michael Finus, Francesco Furini and Anna Viktoria Rohrer

Economics Letters, 2024, vol. 234, issue C

Abstract: A commonly reported result in the literature on international environmental agreements (IEAs) is that if coalition members act as Stackelberg leaders (Stackelberg scenario) this leads to larger stable coalitions than if signatories act simultaneously with non-signatories (Nash-Cournot scenario). This result has been taken for granted, a kind of Folk-theorem, even though it has been proven at best for specific payoff functions, and very often the conclusion is only based on simulations. We prove the Stackelberg vs. Nash-Cournot Folk-theorem based on a generic payoff function for a public good provision game.

Keywords: International environmental agreements; Stability; Stackelberg vs. Nash-Cournot Folk-theorem (search for similar items in EconPapers)
JEL-codes: C72 D62 H41 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:234:y:2024:i:c:s0165176523005074

DOI: 10.1016/j.econlet.2023.111481

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