"Strategic Delegation in the Formation of International Environmental Agreements" with Ralph Winkler (2022)
(published in European Economic Review)
We reassess the well-known “narrow-but-deep” versus “broad-but-shallow” trade-off in international environmental agreements (IEAs), taking into account the principal-agent relationship induced by the hierarchical structure of international policy. To this end, we expand the modest coalition formation game, in which countries first decide on whether to join an agreement and then decide on emissions by a strategic delegation stage. In the weak delegation game, principals first decide whether to join an IEA, then delegate the domestic emission choices to an agent. Finally, agents in all countries decide on emissions. In countries not joining the IEA, agents choose emissions to maximize their own payoff, while agents of countries joining the IEA set emissions to internalize some exogenously given fraction of the externalities that own emissions cause on all members of the IEA. In the strong delegation game principals first delegate to agents, which then decide on membership and emissions. We find that strategic delegation crowds out all efforts to increase coalition sizes by less ambitious agreements in the weak delegation game, while in the strong delegation game the first-best from the principals’ point of view can be achieved.
This paper examines the role of domestic elections and political polarisation in shaping international environmental agreements and how electoral dynamics may explain the limited success of current climate cooperation. I focus on two key factors: the impact of domestic electoral pressure on international policy decisions and the mismatch between short election cycles and long-term treaty commitments. Using a 4-stage game modelling a bilateral environmental agreement, I analyse how incumbents strategically balance policy preferences with reelection prospects. Results show that while a \textit{green} incumbent is often forced to temper their ambitions, a \textit{brown} incumbent faces fewer electoral constraints, explaining why stringent policies are harder to achieve. Nonetheless, electoral pressure can moderate policies, producing outcomes more aligned with the preferences of the median voter. I finally discuss how political polarisation, particularly in two-party systems, adds complexity to international cooperation on global public goods.
"The Private Solution Trap in Collective Action Problems across 34 Nations [Preprint]" with Eugene Malthouse and co-authors (CDMCL) (submitted)
Collective action problems emerge when individual incentives and group interests are misaligned, as in the case of climate change. Individuals facing collective action problems are often considered to have two options: contribute towards a public solution or free-ride. But they might also choose a third option of investing in a private solution such as local climate change adaptation. Experimental research on the dynamics of collective action problems has rarely accounted for the availability of private solutions and has been conducted in single-country contexts (with few exceptions), thereby lacking generalisability. Here we introduce an experimental collective action problem featuring wealth inequalities, public and private solutions, and participants from 34 countries. We show that participants endowed with higher income choose the private solution almost twice as often as those endowed with lower income. This finding cannot be explained by different sources of wealth (luck vs. merit) or by cultural or economic background. We also show that participants endowed with higher income contribute a lower proportion of their wealth towards public solutions, with inequality increasing in every country. Lastly, we report that early contributions represent a universal pathway to public solution provision. Our findings highlight how the "private solution problem" can act as a ubiquitous obstacle in modern collective action problems in which the rich can afford to rely on private solutions while the poor remain unprotected.
"Efficiency versus Equity in a Threshold Public Goods Game" with Ralph Winkler (draft available upon request)
We analyse a threshold public goods game in which players have varying benefits from public goods provision, motivated by the existence of large heterogeneities between countries in international environmental cooperation. The setup chosen specifically allows for an analysis of the trade-off between efficiency and equity. We choose a preference specification allowing for a variety of other-regarding preferences and hypothesize that benefit symmetry among players facilitates coordination due to converging focal points of efficiency and equity. Increasing degrees of asymmetry lead to diverging focal points, rendering cooperation more difficult. Our theoretical predictions are supported by preliminary experimental evidence. We find that provision is most frequent when players are symmetric. While increasing the degree of asymmetry does not significantly hamper provision success, contributions become more volatile the more heterogeneous players are. Analysing how players share contribution costs, we see that the extent of asymmetry is not salient, leading to relatively constant burden-sharing across treatments despite varied levels of inequity.
"Investing in Tomorrow: Understanding the Dynamics of a Green Transition" with Maria Alejandra Erazo
Achieving net-zero emissions requires widespread adoption of green technologies, yet progress is often hindered by coordination and collective action problems rather than technological constraints. We study the dynamics of transitions to sustainable technologies by abstracting the underlying incentive structure into a theoretical framework and testing its implications in a controlled laboratory experiment. In the experiment, participants repeatedly choose between an established technology with stable returns and an emerging technology that is initially less profitable but becomes more attractive as adoption increases. This design captures key features of real-world green transitions, where early adoption is risky but necessary to unlock higher collective payoffs. By varying incentives and uncertainty, we identify the conditions under which groups successfully coordinate on a transition, the role of early adopters, and the factors shaping the speed and efficiency of adoption. Our results provide insights into mechanisms that facilitate cooperation and inform the design of policies that support successful green technology transitions.
"Solar Geoengineering with Trade Sanctions" with Daniel Heyen , Pietro Fasoli, Alessandro Tavoni & Joschka Wanner
We develop a trade-theoretic model of strategic Solar Radiation Management (SRM) in a dynamic setting with tariff policy. Two blocs of countries interact repeatedly, choosing SRM intensity and import tariffs. Although unilateral SRM is feasible and can generate a free-driver problem, linking trade policy to SRM restraint enables self-enforcing outcomes that sustain free trade and disciplined SRM deployment. We characterize the trigger level of SRM that aligns incentives and show how the enforceable cap depends on preference heterogeneity, trade gains, punishment severity, and patience. A transparent calibration, mapping blocs to a cooler, richer North and a hotter, poorer South, illustrates the mechanism. For empirically plausible trade stakes and sufficient patience, the threat of trade retaliation can substantially curb over-cooling incentives; when punishment is weak or actors are impatient, trade leverage fails. Overall, trade retaliation emerges as a conditional governance mechanism for SRM, distinct from counter-geoengineering, and clarifies when a trade-based “climate club” can discipline SRM deployment.
"Climate Dividend Preferences" with Christin Hoffmann & Niklas Ziemann
Climate dividends are a central component of carbon pricing schemes, yet there is limited understanding of how individuals form preferences over dividend designs. This paper studies how information about individuals’ carbon emission records affects preferences for the design of climate dividends. We ask whether making emission differences salient shifts allocation choices, and which behavioural mechanisms underlie these shifts. Using a consequential laboratory experiment including a carbon emissions calculator, participants allocate carbon tax revenues between higher- and lower-emitting individuals under varying information and incentive conditions. The design allows us to disentangle the roles of material self-interest, emission-based group identity, and fairness considerations by varying whether participants know their own emission rank and whether their decision affects their own payoff. Our findings contribute to the growing literature on climate policy acceptance by showing if and how personalised emission information alters redistribution preferences and, in turn, the political feasibility of climate dividends.
"Political Support for Carbon Taxation with Behavioural Agents"
This project aims at investigating how the presence of behavioural voters might be an explanatory factor for the political unpopularity and infeasibility of carbon taxes. Could it explain why some voters are, seemingly, voting against their own self-interests regarding environmental regulation? If so, what are policy implications? If (some) voters are behavioural, they potentially i) do not rationally react to the tax and ii) do not correctly assess their welfare under carbon taxation. As a consequence, it can then happen that a regulatory policy theoretically capable of winning a majority (e.g. the optimal Pigou tax), is rejected at the ballot. In order to determine a potential second-best carbon tax, I suggest an optimal carbon tax game accounting for the behavioural biases assumed.