Short-run vs. long-run cooperation among the G-20 countries

Mundaca, Gabriela (2011): Short-run vs. long-run cooperation among the G-20 countries.

Abstract

In a model of repeated games, we determine the conditions under which cooperation is an equilibrium outcome among the G-20 countries. We consider first, that members are uncertain about the lifespan of the G-20. Second, the nature of member countries and their interrelations can change because of shifts in government regimes. Monitoring and peer pressure to comply with the agreements made are necessary if the goals are to achieve cooperation and thereby attain desirable common goals. If member countries are prone to shifting government regimes and governments are not concerned about their countries' reputations, continuous cooperation becomes more difficult.

• Item Type: MPRA Paper
• Language: English
• Keywords: Repeated games, Prisoners’ Dilemma, cooperation, monitoring, reputation
• Subjects: F - International Economics > F0 - General > F02 - International Economic Order and Integration; E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E61 - Policy Objectives ; Policy Designs and Consistency ; Policy Coordination; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C73 - Stochastic and Dynamic Games ; Evolutionary Games ; Repeated Games

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