Leadership in Climate Change Mitigation: Consequences and Incentives

27 Pages Posted: 13 Mar 2018

See all articles by Gregor Schwerhoff

Gregor Schwerhoff

Mercator Research Institute on Global Commons and Climate Change (MCC)

Ulrike Kornek

Potsdam Institute for Climate Impact Research (PIK)

Kai Lessmann

Potsdam Institute for Climate Impact Research (PIK)

Michael Pahle

Potsdam Institute for Climate Impact Research (PIK)

Date Written: April 2018

Abstract

Initiatives in favor of unilateral action on climate change are frequently challenged by concerns over free riding. Nevertheless, we observe an increasing number of unilateral efforts at different administrative levels and in different parts of the world. Previous academic literature described various individual mechanisms where emissions abroad may increase or decrease as a reaction to unilateral emission reductions. In this paper, we collect a comprehensive set of both positive and negative reactions and analyze them in stylized models. This allows us to identify the most important characteristics that determine the potential of a leader to boost mitigation efforts abroad. We find that this potential depends on (i) a strong ability to generate knowledge through leadership, (ii) a high degree of credibility in the international community, and (iii) a similar economic structure to the most important emitters. While most effects are difficult to quantify, this comprehensive assessment suggests that leakage effects resulting from unilateral mitigation may well be outweighed by positive reactions.

Keywords: Game theory, Leadership, Unilateral climate policy

Suggested Citation

Schwerhoff, Gregor and Kornek, Ulrike and Lessmann, Kai and Pahle, Michael, Leadership in Climate Change Mitigation: Consequences and Incentives (April 2018). Journal of Economic Surveys, Vol. 32, Issue 2, pp. 491-517, 2018. Available at SSRN: https://ssrn.com/abstract=3139053 or http://dx.doi.org/10.1111/joes.12203

Gregor Schwerhoff (Contact Author)

Mercator Research Institute on Global Commons and Climate Change (MCC) ( email )

Torgauer Stra├če 12-15
Berlin, 10829
Germany

HOME PAGE: http://www.mcc-berlin.net/ueber-uns/team/schwerhoff-gregor.html

Ulrike Kornek

Potsdam Institute for Climate Impact Research (PIK) ( email )

Telegrafenberg 31
Potsdam, Brandenburg 14473
Germany

Kai Lessmann

Potsdam Institute for Climate Impact Research (PIK) ( email )

P.O. Box 601203
14412 Potsdam, Brandenburg
Germany

Michael Pahle

Potsdam Institute for Climate Impact Research (PIK) ( email )

Telegrafenberg 31
Potsdam, Brandenburg 14473
Germany

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