A Unifying Theory of Foreign Intervention in Domestic Climate Policy.
Juan Moreno-Cruz, University of Waterloo, jmorenoc@uwaterloo.ca
Anthony Harding, Harvard University, tonyharding@hks.harvard.edu
“Free-riding occurs when a party receives the benefits of a public good without contributing to the costs. In the case of the international climate-change policy, countries have an incentive to rely on the emissions reductions of others without taking proportionate domestic abatement.”
Nordhaus (2015)
“[Free-driving] A second less-familiar externality shows up in the scary form of geo- engineering the stratosphere(...)The challenge with this second global externality also appears to be enormous, because here too so much is at stake, and because it also seems difficult to reach an international governing agreement.”
Weitzman (2015)
Abstract
We propose a theory of climate-policy motivated foreign intervention to study different forms of international climate governance in the presence of power imbalance. Foreign countries have at least three options to intervene in another country’s domestic climate policy: i.) Agreements with Extraction; ii.) Agreements with Transfers; and iii.) Agreements with Sanctions. We distill the fundamental properties of different climate policy options into a simple parameterization and examine the incentivizes and preferences for each type of foreign intervention. We find that the preference for the type of foreign intervention depends critically on the policy externality of different domestic climate policies.