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Participation games and international environmental agreements: a nonparametric model AgEcon
Karp, Larry S.; Simon, Leo K..
We examine the size of stable coalitions in a participation game that has been used to model international environmental agreements, cartel formation, R&D spillovers, and monetary policy. The literature to date has relied on parametric examples; based on these examples, a consensus has emerged that in this kind of game, the equilibrium coalition size is small, except possibly when the potential benefits of cooperation are also small. In this paper, we develop a non-parametric approach to the problem, and demonstrate that the conventional wisdom is not robust. In a general setting, we identify conditions under which the equilibrium coalition size can be large even when potential gains are large. Contrary to previously examined leading special cases, we...
Tipo: Working Paper Palavras-chave: Stable coalitions; Participation game; International Environmental Agreement; Climate agreement; Trans-boundary pollution; Investment spillovers; Environmental Economics and Policy.
Ano: 2012 URL: http://purl.umn.edu/123717
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The Problem of Maintaining Compliance within Stable Coalitions: Experimental Evidence AgEcon
McEvoy, David M.; Murphy, James J.; Spraggon, John M.; Stranlund, John K..
This study examines the performance of stable cooperative coalitions that form to provide a public good when coalition members have the opportunity to not comply with their commitments. A stable coalition is one in which no member wishes to leave and no non-member wishes to join. To counteract the incentive to violate their commitments, coalition members fund a third-party enforcer. This leads to the theoretical conclusion that stable coalitions are larger (and provide more of a public good) when their members must finance enforcement relative to when compliance is ensured without the need for costly enforcement. However, our experiments reveal that giving coalition members the opportunity to violate their commitments while requiring them to finance...
Tipo: Working or Discussion Paper Palavras-chave: Stable coalitions; Self-enforcing agreements; Compliance; Enforcement; Public goods; Environmental Economics and Policy; Institutional and Behavioral Economics; Public Economics; H41; C92.
Ano: 2008 URL: http://purl.umn.edu/42126
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