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Climate Change and Game Theory: a Mathematical Survey

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  • Wood, Peter John
Abstract
This paper examines the problem of achieving global cooperation to reduce greenhouse gas emissions. Contributions to this problem are reviewed from noncooperative game theory, cooperative game theory, and implementation theory. We examine the solutions to games where players have a continuous choice about how much to pollute, and games where players make decisions about treaty participation. The implications of linking cooperation on climate change with cooperation on other issues, such as trade, is also examined. Cooperative and non-cooperative approaches to coalition formation are investigated in order to examine the behaviour of coalitions cooperating on climate change. One way to achieve cooperation is to design a game, known as a mechanism, whose equilibrium corresponds to an optimal outcome. This paper examines some mechanisms that are based on conditional commitments, and their policy implications. These mechanisms could make cooperation on climate change mitigation more likely.

Suggested Citation

  • Wood, Peter John, 2010. "Climate Change and Game Theory: a Mathematical Survey," Working Papers 249379, Australian National University, Centre for Climate Economics & Policy.
    • Handle: RePEc:ags:ancewp:249379
    DOI: 10.22004/ag.econ.249379
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    Cited by:

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    2. Malerba, Daniele, 2020. "Poverty alleviation and local environmental degradation: An empirical analysis in Colombia," World Development, Elsevier, vol. 127(C).
    3. Jing Wu & Jean-Claude Thill, 2018. "Climate change coalition formation and equilibrium strategies in mitigation games in the post-Kyoto Era," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 18(4), pages 573-598, August.
    4. Bašič, Aleksandra Murks & Kamal, Salahuddin M. & Almazroui, Mansour & Al-Marzouki, Fahad M., 2015. "A mathematical model for the climate change: Can unpredictability offset the temptations to pollute?," Applied Mathematics and Computation, Elsevier, vol. 265(C), pages 187-195.
    5. Alessio Carrozzo Magli & Pompeo Della Posta & Piero Manfredi, 2021. "The Tragedy of the Commons as a Prisoner’s Dilemma. Its Relevance for Sustainability Games," Sustainability, MDPI, vol. 13(15), pages 1-10, July.

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