Arbeitspapier
Forging a Global Environmental Agreement through Trade Sanctions on Free Riders?
This paper studies the formation of self-enforcing global environmental agreements in a world economy with international trade and two groups of countries that differ with respect to fuel demand and environmental damage. It investigates whether the signatories’ threat to embargo (potential) free riders secures all countries’ participation in the agreement. Resorting to numerical analysis, we find that an embargo may be unnecessary, ineffective or even counterproductive - depending on the degree of asymmetry and other parameters. On some subset of parameters, the embargo stabilizes the otherwise unstable global agreement, but the threat of embargo is not credible. However, in some of these cases credibility can be restored by suitable intra-coalition transfers.
- Sprache
-
Englisch
- Erschienen in
-
Series: CESifo Working Paper ; No. 5402
- Klassifikation
-
Wirtschaft
Trade and Environment
Environmental Economics: General
Environmental Economics: Government Policy
- Thema
-
embargo
trade
asymmetry
free rider
fuel demand
climate damage
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Eichner, Thomas
Pethig, Rüdiger
- Ereignis
-
Veröffentlichung
- (wer)
-
Center for Economic Studies and ifo Institute (CESifo)
- (wo)
-
Munich
- (wann)
-
2015
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Eichner, Thomas
- Pethig, Rüdiger
- Center for Economic Studies and ifo Institute (CESifo)
Entstanden
- 2015
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