Regional initiatives and the cost of delaying binding climate change agreements

Julien Beccherle*, Jean Tirole

*Corresponding author for this work

    Research output: Contribution to journalArticlepeer-review

    35 Scopus citations


    The Kyoto and Copenhagen Protocols on climate change mitigation postponed the specification of binding commitments to a future negotiation. This paper analyzes the strategic implications of delayed negotiations. While, as is well-understood, the incentive to free ride leads to excessive emissions prior to a binding agreement, the cost of delay is magnified by players' attempt to secure a favorable bargaining position in the future negotiation. A "brinkmanship", an "effort substitution", and a "raising rival's cost" effects all concur to generate high post-agreement emissions. The paper applies this general insight to the issuance of forward or bankable permits.

    Original languageEnglish (US)
    Pages (from-to)1339-1348
    Number of pages10
    JournalJournal of Public Economics
    Issue number11-12
    StatePublished - Dec 2011


    • Bankable permits
    • Cap and trade
    • Climate change
    • International negotiations

    ASJC Scopus subject areas

    • Finance
    • Economics and Econometrics

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