International Environmental Agreements under Uncertainty: Does the Veil of Uncertainty Help?

Michael Finus () and Pedro Pintassilgo
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Pedro Pintassilgo: Faculty of Economics, University of Algarve

No 1003, Discussion Papers from University of Exeter, Department of Economics

Abstract: Na and Shin (1998) showed that the veil of uncertainty can be conducive to the success of self-enforcing international environmental agreements. Later papers confirmed this negative conclusion about the role of learning. In the light of intensified research efforts worldwide to reduce uncertainty about the environmental impact of emissions and the cost of reducing them, this conclusion is intriguing. The purpose of this paper is threefold. First, we analyze whether the result carries over to a more general setting without restriction on the number of players and which considers not only no and full learning but also partial learning. Second, we test whether the conclusion also holds if there is uncertainty about abatement costs instead of uncertainty about the benefits from global abatement. Third, we propose a transfer scheme that mitigates the possible negative effect of learning and which may even transform it into a positive effect.

Keywords: transnational cooperation; self-enforcing international environmental agreements; uncertainty; learning (search for similar items in EconPapers)
JEL-codes: C72 D62 D81 H41 Q20 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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https://exetereconomics.github.io/RePEc/dpapers/DP1003.pdf (application/pdf)

Related works:
Journal Article: International environmental agreements under uncertainty: does the 'veil of uncertainty' help? (2012)
Working Paper: International Environmental Agreements under Uncertainty: Does the Veil of Uncertainty Help? (2010)
Working Paper: International Environmental Agreements under Uncertainty: Does the Veil of Uncertainty Help? (2010)
Working Paper: International Environmental Agreements under Uncertainty: Does the Veil of Uncertainty Help? (2010)
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