Only a World Coalition Won't Feel the Heat

Only a grand coalition – or a coalition including at least all developed countries plus China and India - may be able to stabilize total Greenhouse gases (GHG) concentration in the long run (by year 2100) below the 550 ppm CO₂-eq level, which corresponds to a 2.4° C increment in global mean temperatures with respect to the pre-industrial era. And this is to be considered a modest goal: in international negotiations discussion is normally about limiting the rise to 2° C.

Any alternative coalition may fail to achieve even this target according to Valentina Bosetti (Department of Economics and IEFE), Enrica De Cian, Emanuele Massetti, Massimo Tavoni (Fondazione Eni Enrico Mattei and Euro-Mediterranean Center on Climate Change) and Carlo Carraro (University of Venice, Fondazione Eni Enrico Mattei, CEPR, CESifo and CMCC), who analyze the incentives and the stability of international climate coalitions in Incentives and Stability of International Climate Coalitions: An Integrated Assessment (Energy Policy, vol. 55, April 2013, pages 44-56, doi: 10.1016/j.enpol.2012.12.035).

The authors have studied the complexities of climate coalitions formation. The existing set of incentives is such that stable coalitions tend to be small and ineffective. A successful coalition should have the potential to effectively reduce global emissions and, at the same time, give each of its members sufficient incentives to remain in the coalition. The analysis of the decision to join and of the stability of the coalitions shows that in the case of GHG emission reduction the benefits from cooperation for large and effective coalitions are not enough to compensate free riding incentives. This is why a stable agreement can hardly be achieved.

Stability is obtained only when, through transfers, benefits from cooperation can be shared and incentives to free ride disappear. But the result comes at a price, because, in this case, stability is possible only at concentrations of greenhouse gases as high as 600 ppm CO₂-eq. When transfers enter the picture this level of concentration is possible also with smaller coalitions.

"These results indicate that cooperation on a climate agreement is in principle possible", the authors claim, "though it requires transfers that are politically hard to sell. The resulting emission reductions would be less stringent than those compatible with ambitious climate objectives that are often debated in the climate discussion. A slow and gradual progress towards climate change control seems nonetheless to be only feasible pathway".