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Adaptation to Climate Change and International Mitigation Agreements with Heterogeneous Countries

Author

Listed:
  • Hongxiu Li

    (Department of Economics, University of Waterloo)

  • Horatiu A. Rus

    (Department of Economics, University of Waterloo)

Abstract
This paper investigates the impact of adaptation on a country's incentive to participate in emission-reducing International Environmental Agreements (IEAs) on climate change. We develop a framework where heterogeneity across countries is introduced with respect to the benefits and costs of both mitigation of emissions and adaptation to reduce the impact of climate change. The paper uses two coalition stability concepts and numerical simulations to look at stable coalitions. We also study the effect of an within-coalition increase in the efficiency of adaptation on emissions and on countries' incentives to cooperate. Our main findings are: first, investment in adaptation technology has a public good feature inside the coalition, compared to being strictly a private good in the non-cooperation case. Second, a large coalition cannot be achieved if countries differ much in terms of vulnerability. Third, cooperation incentives can be enhanced by a coalition which diffuses technological progress on climate change adaptation among its members.

Suggested Citation

  • Hongxiu Li & Horatiu A. Rus, 2014. "Adaptation to Climate Change and International Mitigation Agreements with Heterogeneous Countries," Working Papers 1408, University of Waterloo, Department of Economics, revised Oct 2014.
    • Handle: RePEc:wat:wpaper:1408
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    File URL: https://uwaterloo.ca/economics/sites/ca.economics/files/uploads/files/li_and_rus_adaptationieas_oct2014.pdf
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    References listed on IDEAS

    as
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    6. Lazkano, Itziar & Marrouch, Walid & Nkuiya, Bruno, 2016. "Adaptation to climate change: how does heterogeneity in adaptation costs affect climate coalitions?," Environment and Development Economics, Cambridge University Press, vol. 21(6), pages 812-838, December.
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    Cited by:

    1. Miguel Borrero & Santiago J. Rubio, 2022. "An adaptation-mitigation game: does adaptation promote participation in international environmental agreements?," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 22(3), pages 439-479, September.

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    More about this item

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q59 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Other

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