Optimal Transfers and Participation Decisions in International Environmental Agreements

41 Pages Posted: 15 Sep 2005

See all articles by Carlo Carraro

Carlo Carraro

Fondazione Eni Enrico Mattei (FEEM); 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; International Center for Climate Governance

Johan Eyckmans

Catholic University of Leuven (KUL) - Center for Economic Studies

Michael Finus

University of Stirling

Multiple version iconThere are 2 versions of this paper

Date Written: May 2005

Abstract

The literature on international environmental agreements has recognized the role transfers play in encouraging participation in international environmental agreements (IEAs), but the few results achieved so far are overly specific and do not exploit the full potential of transfers for successful treaty-making. Therefore, in this paper, we develop a framework that enables us to study the role of transfers in a more systematic way. We propose a design for transfers using both internal and external financial resources and making 'welfare optimal agreements' self-enforcing. To illustrate the relevance of our transfer scheme for actual treaty-making, we use a well-known integrated assessment model of climate change to show how appropriate transfers may be able to induce almost all countries into signing a self-enforcing climate treaty.

Keywords: Self-enforcing international environmental agreements, climate policy, transfers, international environmental agreements

JEL Classification: C72, H23, Q25, Q28

Suggested Citation

Carraro, Carlo and Eyckmans, Johan and Finus, Michael, Optimal Transfers and Participation Decisions in International Environmental Agreements (May 2005). CEPR Discussion Paper No. 5046. Available at SSRN: https://ssrn.com/abstract=774285

Carlo Carraro (Contact Author)

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Johan Eyckmans

Catholic University of Leuven (KUL) - Center for Economic Studies ( email )

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Leuven, B-3000
Belgium

Michael Finus

University of Stirling ( email )

Stirling, Scotland FK9 4LA
United Kingdom

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