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Information Exchange and Transnational Environmental Problems

Johnson Kakeu () and Erik Paul Johnson ()
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Erik Paul Johnson: Carthage College

Environmental & Resource Economics, 2018, vol. 71, issue 2, No 12, 583-604

Abstract: Abstract This paper analyzes information exchange in a model of transnational pollution control in which countries use private information in independently determining their domestic environmental policies. We show that countries may not always have an incentive to exchange their private information. However, for a sufficiently high degree of predictability of domestic environmental policy processes, the expected welfare from sharing information is greater than the expected welfare from keeping it private. The minimum degree of policy predictability for which information sharing occurs increases with the level of environmental risk. Intuitively, information exchange can help mitigate the perception of global uncertainty (both political and scientific) that surrounds transnational environmental problems and potentially improve welfare if policymaking processes are sufficiently aligned with evidence-based approaches (predictable).

Keywords: Information exchange; Uncertainty; Private information; Environmental policy; Policy predictability; Transnational pollution; Bayesian game approach (search for similar items in EconPapers)
JEL-codes: D8 Q5 F5 (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1007/s10640-017-0174-z

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