A Mechanism for Addressing Compliance and Participation in Global Public Good Treaties: A Comment

Michael Finus ()
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Michael Finus: University of Graz, Austria

No 2024-14, Graz Economics Papers from University of Graz, Department of Economics

Abstract: Kornek and Edenhofer (2020) propose a transfer scheme in the spirit of mechanism design in a two-stage coalition formation game. Not only non-signatories but also signatories choose their provision levels non-cooperatively. They show that the grand coalition is stable, implementing the socially optimal provision level. McEvoy and McGinty (2023) argue in a comment that this scheme is flawed as it does not address free-riding in the sense of non-compliance. I offer a solution to the problem highlighted by McEvoy and McGinty (2023), proposing a modification of the original set-up which addresses both dimensions of free-riding. I demonstrate that the scheme also works for asymmetric countries.

Keywords: Global Public Goods; Agreements; Membership; Compliance. (search for similar items in EconPapers)
JEL-codes: C71 C72 D70 H41 Q54 (search for similar items in EconPapers)
Date: 2024-09
New Economics Papers: this item is included in nep-des and nep-gth
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