Munich Personal RePEc Archive

An international agreement with full participation to tackle the stock of greenhouse gases

Kratzsch, Uwe and Sieg, Gernot and Stegemann, Ulrike (2011): An international agreement with full participation to tackle the stock of greenhouse gases.

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Abstract

This paper analyzes greenhouse gas emissions that build up an atmospheric stock which depreciates over time. Weakly renegotiation-proof and subgame perfect equilibria in a game of international emission reduction exist if countries put a sufficiently high weight on future payoffs, even though there is a discontinuity in the required discount factor due to the integrity of the number of punishing countries. Treaties are easier to reach if the gas depreciates slowly.

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