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Bounded rationality and social interaction in negotiating a climate agreement

  • Elisabeth GsottbauerEmail author
  • Jeroen C. J. M. van den Bergh
Original Paper

Abstract

An agreement on climate change mitigation hinges on large-scale international cooperation. Rational agents are supposed to consider the cost and benefits of cooperation, which then determine their negotiation positions. Behavioral economics provides experimental evidence that decision-making in negotiation-like situations is influenced by systematic cognitive biases and social interaction. In this paper, we examine the impact of bounded rationality and social preferences on bargaining in international climate negotiations and illustrate how particular deviations from full rationality affect the incentives to cooperate. Of special interest are fairness preferences for burden-sharing rules and behavioral responses to different framings of climate change and policy, as well as implications of these for communication about climate change. The analysis will further address different levels of representation, including individual citizens, politicians, experts, and (professional) negotiators. The consequences of the most prominent nonstandard preferences and biases for negotiating a climate treaty are assessed, and specific strategies to foster cooperation are suggested.

Keywords

Bounded rationality Climate change Cooperation Decision biases International treaty Other-regarding preferences 

Notes

Acknowledgments

We are grateful to Wouter Botzen and three anonymous reviewers for useful comments on the paper.

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Copyright information

© Springer Science+Business Media B.V. 2012

Authors and Affiliations

  • Elisabeth Gsottbauer
    • 1
    Email author
  • Jeroen C. J. M. van den Bergh
    • 2
    • 3
    • 4
  1. 1.Institute of Environmental Science and TechnologyUniversitat Autònoma de BarcelonaBellaterra, CerdanyolaSpain
  2. 2.ICREABarcelonaSpain
  3. 3.Department of Economics and Economic History & Institute for Environmental Science and TechnologyUniversitat Autònoma de BarcelonaBellaterra, CerdanyolaSpain
  4. 4.Faculty of Economics and Business Administration and Institute for Environmental StudiesVU University AmsterdamAmsterdamThe Netherlands

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