Sober optimism and the formation of international environmental agreements

Hiroaki Sakamoto and Larry Karp

Discussion papers from Graduate School of Economics , Kyoto University

Abstract: We analyze a dynamic model of international environmental agreements (IEAs) where countries cannot make long-term commitments or use sanctions or rewards to induce cooperation. Countries can communicate with each other to build endogenous beliefs about the random consequences of (re)opening negotiation. If countries are patient, an effective agreement can be reached after a succession of short-lived ineffective agreements. This eventual success requires \sober optimism": the understanding that cooperation is possible but not easy to achieve. Negotiations matter because beliefs are important. An empirical application illustrates the importance of sober optimism in the climate agreement.

Keywords: Environmental agreements; Climate change; Dynamic game (search for similar items in EconPapers)
JEL-codes: C72 C73 D62 H41 Q54 (search for similar items in EconPapers)
Pages: 33
Date: 2019-05
New Economics Papers: this item is included in nep-agr, nep-bec, nep-ene, nep-env and nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Journal Article: Sober optimism and the formation of international environmental agreements (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:kue:epaper:e-19-002

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