Leadership in Climate Policy: Is there a case for Early Unilateral Unconditional Emission Reductions?

Gunnar Eskeland

No 2013/6, Discussion Papers from Norwegian School of Economics, Department of Business and Management Science

Abstract: One may misread economic theory on climate policy to provide a warning against unilateral mitigation. While important lessons are drawn from ‘global problems require global solutions’, these say little about what to do in a phase before or without a global agreement - or with weak ones. In the literature on cooperation and leadership in provision of public goods, early provision may stimulate provision from others. A key to leadership is signaling; an early mover has private information and is motivated in part by knowing that others will follow. Others will follow if they understand that the early mover demonstrates that emission reductions are feasible and adoptable. Our analysis finds that early movers will be cognizant of what they need to demonstrate, and they will be concerned about and act on carbon leakage. Leadership can be deterred by concerns for free riding, but this is more likely for a country or coalition that is large in terms of emissions and face others who are both large and vulnerable to climate change. We suggest leadership is possible early in this century: numbers indicate that few – if any - need find themselves deterred from early action of some sort.

Keywords: Climate policy; unilateral mitigation (search for similar items in EconPapers)
JEL-codes: Q00 Q50 Q54 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2013-06-14
New Economics Papers: this item is included in nep-ene, nep-env and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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