International environmental cooperation: A new eye on the greenhouse gas emissions' control

Abstract

This paper re-examines the formation of International Environmental Agreements (IEAs) modelled as a two-stage non-cooperative game when countries' strategies to control pollution are complementary. This new assumption relying on empirical and theoretical evidences means that reinforcement effects do exist between countries' strategies when polluting or abating. From a deliberately conventional model the results established analytically strongly contrast with those in the literature on IEAs. We find that the unique stable agreement can consist in half countries involved in the negotiation; we demonstrate that the environmental impact of such cooperation is almost total: it tends toward the one of the full cooperative solution. Even if the incentives to free-ride are less strong, we do not observe the formation of the "grand" coalition: not all the countries sign the agreement. We also explain why the level of cooperation is decreasing with the perception countries have of the seriousness of the problem. © 2012 Springer Science+Business Media, LLC.