Are Uniform Solutions Focal? – The Case of International Environmental Agreements

Urs Brandt ()

Environmental & Resource Economics, 2003, vol. 25, issue 3, 357-376

Abstract: The application of uniform solutions has several drawbacks, notably their lack of cost efficiency and their inability to guarantee individual rationality. A ‘proper’ specification of uniform solutions, however, reveals that uniform solutions that satisfy individual rationality always exist. When all countries hold private information about their own reduction costs, there only exists one solution that always satisfies individually rationality without use of side payments and the requirement of dominant strategy implementation: The solution that selects the smallest individually preferred uniform reduction which also give a theoretical explanation of the ‘lowest common denominator effect’. Copyright Kluwer Academic Publishers 2003

Keywords: feasibility constraints; focal solutions; international environmental agreements; uniform solutions (search for similar items in EconPapers)
Date: 2003
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DOI: 10.1023/A:1024432709657

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