Endogenous Strategic Issue Linkage in International Negotiations

30 Pages Posted: 26 Jun 2003

See all articles by Carlo Carraro

Carlo Carraro

Ca' Foscari University of Venice; CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division); IPCC; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Centre for European Policy Studies, Brussels; Green Growth Knowledge Platform

Carmen Marchiori

Fondazione Eni Enrico Mattei (FEEM); University College London

Date Written: April 2003

Abstract

This paper analyses issue linkage as a way to increase co-operation on issues where incentives to free-ride are strong. The goal is to determine under what conditions players prefer to link negotiations on two different issues rather than to negotiate on the two issues separately. Suppose that players are asked to vote on issue linkage before starting negotiations. Under what conditions would they vote in favour of issue linkage? The answer to this question is not trivial. Issue linkage may indeed increase the number of cooperators on the provision of a public good (a typical issue characterised by strong incentives to free-ride). However, at the same time, issue linkage may reduce the number of cooperating players on the other economic issue which is linked to the provision of a public good. Players therefore face a trade-off. This paper analyses this trade-off within a game-theoretic framework and shows under what conditions issue linkage is players' equilibrium strategy.

Keywords: International Environmental Agreements, Coalition Formation Games, Issue Linkage

Suggested Citation

Carraro, Carlo and Marchiori, Carmen, Endogenous Strategic Issue Linkage in International Negotiations (April 2003). FEEM Working Paper No. 40.2003, Available at SSRN: https://ssrn.com/abstract=419060 or http://dx.doi.org/10.2139/ssrn.419060

Carlo Carraro (Contact Author)

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Carmen Marchiori

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