Coalition formation in a global warming game: How the design of protocols affects the success of environmental treaty-making

Abstract

We combine new concepts of noncooperative coalition theory with an integrated assessment model on climate change to analyze the impact of different protocol designs on the success of coalition formation. We analyze the role of “single versus multiple coalitions,”“open versus exclusive membership,”“no, weak and strong consensus about membership” and “no transfers versus transfers.” First, we want to find out whether and how modifications of the standard assumptions affect results that are associated with the widely applied cartel formation game in the noncooperative game theoretic analysis of international environmental agreements. Second, we discuss normative policy conclusions that emerge from the various modifications. Third, we confront our results with evidence on past international environmental treaties and derive an agenda for future research. © 2006 Rocky Mountain Mathematics Consortium.