ANNOUNCEMENTS
Over the last several decades, governments have collectively pledged to slow global warming. But despite intensified diplomacy, the world is already facing the consequences of climate change, and these impacts are expected to get worse in the coming years. However, not much has been done to resolve this global climate change crisis.
This paper studies two major international climate agreements and how their mechanisms promote international cooperation amongst the member nations. The Kyoto Protocol and the Paris Agreement are pivotal international frameworks aimed at mitigating climate change. Both agreements involve complex negotiations between developed and developing countries, particularly concerning the transfer of technology to support climate action. The main aim of this paper is to analyze the Kyoto Protocol and the Paris Agreement mechanisms.
As per many studies Kyoto Protocol had little effect on global greenhouse gas mitigation. However, what difference did the Paris Agreement make and was it more efficient in any manner is a question that still remains unanswered.
The Kyoto Protocol, with its emission reduction targets for industrialized nations, can be viewed as an attempt at a cooperative game to address climate change. The Paris Agreement, with its Nationally Determined Contributions (NDCs) and the emphasis on global cooperation, builds upon this framework and offers a more flexible approach. The Paris Agreement's emphasis on all countries participating in mitigation efforts, unlike the Kyoto Protocol, alters the incentive structure and may encourage more cooperation.
The efficiency of these agreements can be analysed with the help of game theory. According to game theorists, every country shall benefit by cooperating, but they’re willing to cheat by sticking to fossil fuels and continuing to invest in carbon-emitting industries, leaving everyone worse off.
Game theory, especially the repeated Prisoner's Dilemma (PD), offers a valuable lens to analyze these interactions and countries might choose to cooperate on climate action, or not.
The Paris Agreement's emphasis on all countries participating in mitigation efforts, unlike the Kyoto Protocol, alters the incentive structure and may encourage more cooperation.
Game theory helps explain why the Paris Agreement might be more successful than the Kyoto Protocol. While the Kyoto Protocol, with its binding commitments on specific countries, faced challenges due to the "prisoner's dilemma" where non-cooperation was the dominant strategy, the Paris Agreement, with its bottom-up approach and voluntary commitments, is seen as a "stag hunt" game where cooperation is more likely.
This study through a game theory model provides a framework for understanding and enhancing technology transfer through the carbon market mechanisms under the Kyoto Protocol and the Paris Agreement. By incorporating empirical data, the paper offers insights into how to structure policies that promote effective cooperation between developed and developing countries. Lastly, it concludes that the UNFCCC shall continue to develop international climate change treaties to resolve earlier deficiencies.
