Game theoretic research on the design of international environmental agreements : insights, critical remarks and future challenges

Finus, Michael GND

In recent years, the number of publications that analyze the formation and stability of international environmental agreements (IEAs) using the method of game theory has sharply increased. However, there have also been voices that criticize game theoretic analyses for being based on too abstract models and assuming too much about the rationality of agents. This paper reports on some recent results that shall demonstrate the usefulness but also the limitations of game theory for the analysis of IEAs. It focuses on the relation between different designs and the success of IEAs. Results are illustrated for the climate change problem with the empirical Stability of Coalitions (STACO) Model developed by Dellink et al. (2004). Subsequently, some features of actual treaty-making not considered with this model are discussed with reference to the literature and their importance for future research is highlighted.

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Finus, Michael: Game theoretic research on the design of international environmental agreements. insights, critical remarks and future challenges. Hagen 2007. FernUniversität in Hagen.

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