We consider the formation of an international environmental agreement focusing on adaptation to climate change. Members of the agreement fully share their knowledge and determine their investments in R&D by maximizing their joint welfare, while non-members optimize their individual payoffs. Using a three-stage game formalism, we obtain that a large coalition is achievable and that total emissions increase with the size of the agreement. The welfare implications are parameter dependent. (C) 2017 Elsevier B.V. All rights reserved.
Masoudi, N; Zaccour, G
Adapting to climate change: Is cooperation good for the environment?
Economics Letters