Référence

Julien Beccherle et Jean Tirole, « Regional Initiatives and the Cost of Delaying Binding Climate Change Agreements », IDEI Working Paper, n° 628, décembre 2010.

Résumé

The Kyoto and Copenhagen Protocols on climate change mitigation postponed the specification of binding commitments to a future negotiation. This paper analyzes the strategic implications of delayed negotiations. While, as iswell-understood, the incentive to free ride leads to excessive emissions prior to a binding agreement, the cost of delay is magnified by players’ attempt to secure a favorable bargaining position in the future negotiation. A “brinkmanship”, an “effort rebalancing”, and a “raising rival’s cost” effects all concur to generate high post-agreement emissions. The paper applies this general insight to a variety of policy instruments, from the issuance of forward or bankable permits to standards and green investment policies.

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Codes JEL