Work

Transfers in climate action teams

Year: 2024

Type: article

Abstract: Resource transfers are integral parts of climate negotiations as they affect incentives to participate in climate agreements. Whether to use transfers contingent on observing low emissions or on investment in green compliance technology is an open question. Using a repeated-game model with investment in green technology and resource transfers, we find that, because investments take time to fully affect emission incentives, there is a tradeoff. Investment-based agreements, where transfers are provided before emissions are realized but after investments have been undertaken, maximize the scope of cooperation. Emissions-based agreements, however, minimize the size of transfers whenever they foster cooperation.

Source: Economic Theory

DOI: 10.1007/s00199-024-01600-w

Authors: Suzi Kerr, Steffen Lippert, Edmund Y. Lou

Institutions: Environmental Defense Fund, University of Auckland, Te Pūnaha Matatini, Northwestern University

Language: English

Topic: Climate Change Policy and Economics

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Climate action

Open Access status: hybrid

Estimated APC paid: $2,990