Self-enforcing climate coalitions for farsighted countries: integrated analysis of heterogeneous countries | Maria Arvaniti

Maria Arvaniti is an assistant professor at the Department of Economics at the University of Bologna. She works on a variety of applied theory topics, mostly related to environmental applications. Her current research focuses on behavioural anomalies such as temptation preferences and present bias, the strategic aspects of such problems and the design of optimal policies. Maria also works on topics related to environments agreements and strategic delegation as well as the optimal management of natural resources in the presence of regime shifts. She has published in international journals such as Journal of Environmental Economics and Management and Journal of Mathematical Economics. 

Maria will be discussing the paper Self-Enforcing Climate Coalitions for Farsighted Countries: Integrated Analysis of Heterogeneous Countries by Sareh Vosooghi, Maria Arvaniti and Federick van der Ploeg.

Abstract

We study formation of international climate coalitions. Countries are farsighted and rationally predict the consequences of their membership decisions in climate negotiations. Within the context of an integrated assessment model of the economy and the climate, we characterise the equilibrium number of coalitions and their number of signatories independent of certain types of heterogeneity, and show that the resulting treaties are robust to renegotiation. With a richer structure of energies we investigate possible coalition outcomes for a calibrated model. We confirm our heterogeneity results and in contrast to earlier approaches based on internal and external stability, much larger coalitions can be sustained in equilibrium.