Seminar Internal Seminar: Maria Arvaniti

Abstract

This paper studies the formation of international climate coalitions by heterogeneous countries. Countries rationally predict the consequences of their membership decisions in climate negotiations. We o er an approach to characterise the equilibrium number of coalitions and their number of signatories independent of their heterogeneity, and we suggest a tractable algorithm to fully characterise the equilibrium. In a dynamic game analysis of a general equilibrium model of the economy integrated with climate dynamics, a grand climate coalition or multiple climate coalitions may form in equilibrium, but if the policymakers are patient, the number of signatories in all climate treaties is a Tribonacci number. Our results are robust to the possibility of renegotiation and investment in green technologies besides fossil fuels.