Environmental and Resource Economics

, Volume 66, Issue 4, pp 605–627 | Cite as

Cooperation and Competition in Climate Change Policies: Mitigation and Climate Engineering when Countries are Asymmetric

Article

Abstract

We study a dynamic game of climate policy design in terms of emissions and solar radiation management (SRM) involving two heterogeneous countries or group of countries. Countries emit greenhouse gasses (GHGs), and can block incoming radiation by unilateral SRM activities, thus reducing global temperature. Heterogeneity is modelled in terms of the social cost of SRM, the environmental damages due to global warming, the productivity of emissions in terms of generating private benefits, the rate of impatience, and the private cost of geoengineering. We determine the impact of asymmetry on mitigation and SRM activities, concentration of GHGs, and global temperature, and we examine whether a tradeoff actually emerges between mitigation and SRM. Our results could provide some insights into a currently emerging debate regarding mitigation and SRM methods to control climate change, especially since asymmetries seem to play an important role in affecting incentives for cooperation or unilateral actions.

Keywords

Climate change Mitigation Solar radiation management Cooperation Differential game Asymmetry  Feedback Nash equilibrium 

JEL Classification

Q53 Q54 

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Copyright information

© Springer Science+Business Media Dordrecht 2015

Authors and Affiliations

  1. 1.Athens University of Economics and BusinessAthensGreece

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