Browsing by Author "Tulkens, Henry"

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The Acid Rain Game as a Resource Allocation Process with an Application to the International Cooperation among Finland, Russia, and Estonia
(1993) Kaitala, Veijo; Mäler, Karl-Göran; Tulkens, Henry
"We consider optimal cooperation in transboundary air pollution abatement among several countries under incomplete information. The countries negotiate on establishing a gradual cooperative emission reduction program to reduce the damages caused by sulphur depositions. Local information available on the marginal emission abatement costs and damage costs allows one to determine directions of emission abatement in each country that converge to an economic optimum. A particular difficulty arising here is how the partners can guarantee that the costs and benefits from cooperation will be shared in such a way that none of them will be tempted to breach the agreement. To overcome this problem we make use of a cost sharing scheme proposed by Chander and Tulkens (1991), that results from appropriately designed international transfers. This scheme guarantees that the individual costs of all parties are nonincreasing along the path towards the optimum, and that no party or group of parties has an interest in proposing another abatement policy. The paper illustrates these methods by applying them to a three-country version of Maler's (1989) 'acid rain game', tailored to numerically simulate the negotiations on sulphur emissions abatement between Finland, Russia and Estonia."
Cooperation Versus Free-Riding in International Environmental Affairs: Two Approaches
(1998) Tulkens, Henry
"This chapter is about a controversy regarding the feasibility, and as a consequence the likelihood, of cooperation among countries on issues of transfrontier pollution. I want to contrast two theses, a pessimistic one and an optimistic one. Both of them are based on concepts rooted in economic analysis, and both of them claim additional support from game theory. Nevertheless they reach opposing conclusions. It is thus a challenging task to try to disentangle the arguments used on each side, in order to see whether the two theses can be reconciled or are intrinsically antagonistic."
The Core of an Economy With Multilateral Environmental Externalities
(1994) Chander, Parkash; Tulkens, Henry
"When environmental externalities are international-i..e. transfrontier-they most often are multilateral and embody public good characteristics. Improving upon inefficient laissez-faire equilibria requires voluntary cooperation for which the game-theoretic core concept provides optimal outcomes that have interesting properties against free riding. To define the core, however, the characteristic function of the game associated with the economy (which specifies the payoff achievable by each possible coalition of players- here, the countries) must also specify in each case the behavior of the players which are not members of the coalition. This has been for a long time a major unsolved problem in the theory of the core of economies with many producers of a public good. Among the several assumptions that can be made in this respect, a plausible one is defined in this paper, for which it is then shown that the core is nonempty. The proof is constructive in the sense that it exhibits a solution (i.e., an explicit coordinated abatement policy) that has the desired property of nondomination by any proper coalition of countries, given the assumed behavior of the other countries."
A Core-Theoretic Solution for the Design of Cooperative Agreements on Transfrontier Pollution
(1994) Chander, Parkash; Tulkens, Henry
"For a simple economic model of transfrontier pollution, widely used in theoretical studies of international treaties bearing on joint abatement, we exhibit in this paper a scheme for sharing national abatement costs, through international financial transfers, which is inspired by a very classical solution concept offered in the theory of cooperative games, namely the 'core' of a game. The scheme has the following properties: (i) total damage and abatement costs in all countries are minimized (optimality property), and (ii) no 'coalition', i.e. subset, of countries can achieve lower such total costs for its members by taking another course of action in terms of emissions and/or transfers, under some reasonable assumption as to the reactions of those not in the coalition (core property)."
Financial Transfers to Sustain Cooperative International Optimality in Stock Pollutant Abatement
(Edward Elgar, 1998) Germain, Marc; Toint, Philippe; Tulkens, Henry; Faucheux, S.; Gowdy, J.; Nicolai, I.
"It is well known that the transnational character of many environmental problems (for example, greenhouse gas emissions, acid rain, pollution of international waters) requires cooperation among the countries involved if a social optimum is to be achieved. The issues raised thereby have often been addressed, in the economic literature, using concepts borrowed from cooperative game theory."
Simulating Coalitionally Stable Burden Sharing Agreements for the Climate Change Problem
(2001) Eyckmans, Johan; Tulkens, Henry
"The CLIMNEG World Simulation (CWS) model is introduced here for simulating cooperative game theoretic aspects of global climate negotiations. The CWS model is derived from the seminal RICE model by Nordhaus and Yang (1996). We first state the necessary conditions that determine Pareto efficient investment and emission abatement paths under alternative regimes of cooperation between the regions. We then show with a numerical version of the CWS model that the transfer scheme advocated by Germain, Toint and Tulkens (1997) induces an allocation in the ('gamma') core of the world carbon emission abatement cooperative game."