TY - JOUR

T1 - Coalition stability in international environmental matching agreements

AU - Süring, Charlotte

AU - Weikard, Hans Peter

N1 - Publisher Copyright: © The Author(s) 2024.

PY - 2024/3

Y1 - 2024/3

N2 - This study presents empirically calibrated simulations of three different variants of environmental matching agreements aimed at reducing global greenhouse gas emissions. We determine whether matching agreements can produce larger stable coalitions and increase abatement contributions and payoffs as compared to standard agreements. The matching agreements we analyze feature uniform matching rates by which coalition members match the unconditional contributions of (i) the other coalition members, (ii) all other players, or (iii) only non-members, while non-members do not commit to any matching and maximize their individual payoffs. The simulation considers twelve asymmetric world regions with linear abatement benefits and quadratic costs, calibrated based on the STACO 3 model, and uses emissions data from the shared socioeconomic pathways database. We find that the first variant of the matching game fails to produce any stable coalitions and thus performs worse than the standard agreement that produces a stable two-player coalition. The second variant produces a stable grand coalition and significantly increases the abatement and payoff levels beyond the non-cooperative Nash baseline. Partial coalitions are unstable in this game. The third variant produces a two-player coalition similar to the standard coalition formation game, but with different members and higher abatement and payoff levels due to the matching mechanism.

AB - This study presents empirically calibrated simulations of three different variants of environmental matching agreements aimed at reducing global greenhouse gas emissions. We determine whether matching agreements can produce larger stable coalitions and increase abatement contributions and payoffs as compared to standard agreements. The matching agreements we analyze feature uniform matching rates by which coalition members match the unconditional contributions of (i) the other coalition members, (ii) all other players, or (iii) only non-members, while non-members do not commit to any matching and maximize their individual payoffs. The simulation considers twelve asymmetric world regions with linear abatement benefits and quadratic costs, calibrated based on the STACO 3 model, and uses emissions data from the shared socioeconomic pathways database. We find that the first variant of the matching game fails to produce any stable coalitions and thus performs worse than the standard agreement that produces a stable two-player coalition. The second variant produces a stable grand coalition and significantly increases the abatement and payoff levels beyond the non-cooperative Nash baseline. Partial coalitions are unstable in this game. The third variant produces a two-player coalition similar to the standard coalition formation game, but with different members and higher abatement and payoff levels due to the matching mechanism.

KW - Coalition formation and stability

KW - Global public goods

KW - International environmental agreements

KW - Matching games

KW - STACO model

U2 - 10.1007/s10726-024-09878-w

DO - 10.1007/s10726-024-09878-w

M3 - Journal article

AN - SCOPUS:85188456994

VL - 33

SP - 587

EP - 615

JO - Group Decision and Negotiation

JF - Group Decision and Negotiation

SN - 0926-2644

ER -