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Can Social Externalities Solve the Small Coalitions Puzzle in International Environmental Agreements?

Author

Listed:
  • Marie-Laure Cabon-Dhersin

    (GRID-ENSAM-Paris and Ecole Normale Supérieure de Cachan)

  • Shyama V. Ramani

    (LORIA and CECO, Ecole Polytechnique, Paris)

Abstract
A puzzle in the literature on the formation of coalitions supporting International Environmental Agreements (IEAs) is that if an IEA leads to substantial gains, then it will not be supported by many countries. The non-cooperative game theoretic literature highlights the “small coalitions” puzzle by which only a small number of countries are willing to sign an environmental convention. In these models, a global coalition comprising all countries and generating significant benefits is not sustainable. Moreover they indicate that greater the number of countries in the coalition, higher the incentive of signatories to not respect their engagement. The present paper resolves this puzzle by introducing social externalities, in order to explain why some treaties can be sustained by nearly all countries, while others can be supported only by a handful.

Suggested Citation

  • Marie-Laure Cabon-Dhersin & Shyama V. Ramani, 2006. "Can Social Externalities Solve the Small Coalitions Puzzle in International Environmental Agreements?," Economics Bulletin, AccessEcon, vol. 17(4), pages 1-8.
    • Handle: RePEc:ebl:ecbull:eb-06q00002
    as

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    File URL: http://www.accessecon.com/pubs/EB/2006/Volume17/EB-06Q00002A.pdf
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    References listed on IDEAS

    as
    1. Lange, Andreas & Vogt, Carsten, 2003. "Cooperation in international environmental negotiations due to a preference for equity," Journal of Public Economics, Elsevier, vol. 87(9-10), pages 2049-2067, September.
    2. Parkash Chander & Henry Tulkens, 2006. "A Core-Theoretic Solution for the Design of Cooperative Agreements on Transfrontier Pollution," Springer Books, in: Parkash Chander & Jacques Drèze & C. Knox Lovell & Jack Mintz (ed.), Public goods, environmental externalities and fiscal competition, chapter 0, pages 176-193, Springer.
    3. Carraro, Carlo & Siniscalco, Domenico, 1993. "Strategies for the international protection of the environment," Journal of Public Economics, Elsevier, vol. 52(3), pages 309-328, October.
    4. Claude d'Aspremont & Alexis Jacquemin & Jean Jaskold Gabszewicz & John A. Weymark, 1983. "On the Stability of Collusive Price Leadership," Canadian Journal of Economics, Canadian Economics Association, vol. 16(1), pages 17-25, February.
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    Cited by:

    1. Chiara Donnini & Marialaura Pesce, 2023. "Fairness and formation rules of coalitions," International Journal of Economic Theory, The International Society for Economic Theory, vol. 19(4), pages 933-960, December.
    2. Michèle Breton & Lucia Sbragia & Georges Zaccour, 2010. "A Dynamic Model for International Environmental Agreements," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 45(1), pages 25-48, January.
    3. Chiara Donnini & Armando Sacco, 2024. "Social equity in international environmental agreements," Journal of Global Optimization, Springer, vol. 90(1), pages 261-291, September.
    4. Lina Mallozzi & Stefano Patri & Armando Sacco, 2015. "Differential Game Approach for International Environmental Agreements with Social Externalities," Czech Economic Review, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, vol. 9(3), pages 135-154, December.

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    More about this item

    JEL classification:

    • Q0 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General
    • D7 - Microeconomics - - Analysis of Collective Decision-Making

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