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Emerging regional powers, such as Brazil and India, are reshaping world politics. We conduct a game-theoretic analysis to examine how growing regional powers compete for influence against a global power, such as the United States, in different circumstances. If the global power regards dominant positions in different regions as strategic substitutes (complements), a stronger regional power in region A increases (decreases) the global power’s efforts to dominate in region B. For example, if Iran grows stronger, the United States should increase its efforts to secure energy resources in Central Asia as substitutes for Middle Eastern oil. Conversely, suppose the United States fails to create support for stringent intellectual property rights protection in Latin America because Brazil opposes new rules. In this case, we expect the United States to have fewer incentives to create support in other regions because intellectual property rights rules are most valuable when they constitute a complementary global standard. [ABSTRACT FROM PUBLISHER]

Donors often condition foreign aid to recipients on policy adjustments. How do domestic interest groups influence a donor’s ability to credibly commit to implementing threats and promises? In our model, domestic interest groups in the donor country can mobilize to support the donor’s implementation of punishments and rewards. The expectation of such mobilization influences the credibility of threats and promises at the prior contracting stage. The analysis produces three central findings. First, the donor chooses to rely on a single instrument when the domestic interest group exhibits a strong preference for that instrument, even if the cost of using that instrument is relatively high. Second, for credibility reasons the donor often promises generous rewards or threatens ruthless sanctions that seem out of proportion. Finally, the donor cannot simultaneously make credible threats and promises unless domestic interest groups mobilize to support both instruments. We examine the case of US foreign aid to Israel and Palestine to illustrate these theoretical propositions. [ABSTRACT FROM PUBLISHER]

The role of technology cooperation in international climate policy has drawn considerable attention in recent years. This article examines the possibility that an international agreement to deploy clean energy would pave the way to future climate cooperation. My game-theoretic analysis shows that even if technology deployment produces mostly private benefits for each country, an agreement can increase global pollution abatement efforts. If technology deployment allows countries to credibly commit to pollution abatement through sunk costs, the international community can form two coalitions. One deploys the technology and then abates pollution, whereas the other only abates pollution. A technology deployment agreement is useful and feasible when the total number of concerned countries is high and technology deployment is very costly but effective in reducing the cost of future pollution abatement. [ABSTRACT FROM AUTHOR]

International environmental cooperation is difficult because states disagree on burden sharing and have incentives to free ride. However, interested countries can promote future cooperation through unilateral action that induces technological change in and, thereby, shapes the preferences of foreign countries. How can the effectiveness of such unilateral action be improved? This article offers a game-theoretic analysis of the value of combining unilateral action with trade sanctions, or policies that force foreign exporters to comply with domestic environmental regulations. Trade sanctions can significantly improve the effectiveness of unilateral action, but only when (1) they induce clean technology adoption by exporters in targeted countries and (2) this reduces the cost of clean technology elsewhere in the economy through intersectoral technology spillovers. [ABSTRACT FROM AUTHOR]

The funding of global public goods, such as climate mitigation, presents a complex strategic problem. Potential recipients demand side payments for implementing projects that furnish global public goods, and donors can cooperate to provide the funding. We offer a game-theoretic analysis of this problem. In our model, a recipient demands project funding. Donors can form a multilateral program to jointly fund the project. If no program is formed, bilateral funding remains a possibility. We find that donors rely on multilateralism if their preferences are relatively symmetric and domestic political constraints on funding are lax. In this case, the recipient secures large rents from project implementation. Thus, even donors with strong interests in global public good provision have incentives to oppose institutional arrangements that promote multilateral funding. These incentives have played an important role in multilateral negotiations on climate finance, especially in Cancun (2010) and Durban (2011). [ABSTRACT FROM AUTHOR]

Abstract: Carbon dioxide emissions are growing rapidly in the developing world, and industrialized countries have access to resources that could fund additional mitigation in the global South. In this article, I examine the political economy of North–South climate finance. Building on previous research, I develop a game-theoretic model that includes three key issues in climate finance: incentives for recipient participation, capacity building, and leveraging private finance. The game-theoretic analysis shows how these factors interact and produces several interesting empirical implications. For example, improvements in recipient quality can decrease the donor''s capacity building efforts and the probability of successful project implementation. [Copyright &y& Elsevier]

In democratic societies, citizens can hold their government politically accountable for the consequences of international cooperation. Can democratic accountability shape international cooperation under strategic interdependence, and if so, to what effect? I show formally that citizens can endow a government with incentives to promote the public good by conditioning political support on the consequences of international cooperation. Contravening the conventional wisdom, democratic accountability effectively shapes international cooperation. Since international cooperation is reciprocal, domestic democratic accountability also influences the behavior of foreign governments, even if they are autocratic. Empirically, democratic accountability in one country increases the expected dyadic level of international cooperation if and only if the expected social benefits to that country are substantial enough. However, the analysis also reveals that democracies might sometimes obtain a higher payoff from cooperation with autocracies that do not have democratic accountability mechanisms. These findings indicate that the democratic propensity for international cooperation is a contingent phenomenon. [ABSTRACT FROM PUBLISHER]

Abstract: Clean technology is central to climate cooperation. How can countries promote the development and adoption of new clean technologies? In this article, I examine the strategic benefits of establishing an international technology fund. A game-theoretic analysis shows that a technology fund with a dual mandate of rewarding technology development and subsidizing subsequent adoption can contribute to climate cooperation. Interestingly, a technology fund can also reduce North-South distributional conflict. My institutional analysis reveals two particularly important issues in the design of a technology fund: credible commitment to funding rules and the use of a balanced burden sharing rule. Based on these observations, I propose that a technology fund could be established within the institutional framework of the World Bank. [Copyright &y& Elsevier]

According to the imperative of enforcement, states must threaten defectors with sanctions or reciprocal suspension of international cooperation. I show that in international cooperation between the weak and the powerful, states should nevertheless limit the supply of collective enforcement power. Strong sanctions allow exploitative international agreements, so weak states refuse to engage in negotiations with powerful states in the first place. For powerful states, toothless international agreements are a credible commitment to limit power politics. The result holds even if sanctions can be used only to enforce international agreements and not for coercion. It implies that under power asymmetry, states must accept constraints on the use of power, as opposed to simply maximizing the supply of collective enforcement power. The theory offers a new perspective to international cooperation and a synthesis of the enforcement and managerial schools of international cooperation. It produces precise analytical boundary conditions and generates falsifiable empirical hypotheses. [ABSTRACT FROM PUBLISHER]

International technology cooperation promises to help countries exploit the potential of new innovations, but commercial rivalry between companies and governments raises obstacles to it. In this article, I present and solve a model of international technology cooperation. The formal analysis shows that a technology agreement must address two issues. First, governments must be able to induce companies to innovate. Second, governments must credibly commit to penalizing companies for failing to share new information produced through research. Based on these observations, I show that the potential for technology cooperation is maximized in symmetric settings between equally capable governments and companies. In practice, this observation warrants a policy focus on countries and industries that are already on a level playing ground. I also consider extensions to multinational companies and adverse selection problems. The formal analysis provides a solid foundation for practical policy implementation. [ABSTRACT FROM AUTHOR]

Why do governments sometimes exercise unilateral leadership in international environmental cooperation, such as the mitigation of global climate change? It is usually the case that unilateral leadership cannot solve the problem at hand, so it is not clear what the benefits of unilateral leadership are. In this article, I provide a new political rationale for unilateral leadership. I show that if a green politician (worried about environmental destruction) fears that he or she will probably lose power soon, he or she may want to unilaterally implement domestic mitigation policies to reduce the domestic cost of mitigation in the future. By exercising unilateral leadership, this politician ensures that even a future brown politician (only mildly interested in environmental protection) is, due to the domestic cost reduction, willing to engage in international cooperation. The findings imply that while unilateral leadership is not a panacea, it may be a useful commitment device under empirically plausible conditions. [ABSTRACT FROM AUTHOR]

Gradualism is common in international cooperation, as states begin with limited cooperation and choose more ambitious targets slowly over time. However, most models of international cooperation are static and thus cannot explain gradualism. I show that when states can implement domestic reforms to reduce the cost of international cooperation, enforcement concerns prompt gradualism. First, to achieve ambitious international cooperation, states must internationally enforce costly domestic reform. Second, defection at the reform stage is particularly pernicious. When other states reform, their ability to punish the defector by suspending cooperation is reduced. States choose the extent of reform to maximize the benefits of expected international cooperation in the future. As collective enforcement power increases or the number of states decreases, the extent and pace of reform increase. Gradualism is also most probable in international public good provision because excludable benefits mitigate enforcement problems. [ABSTRACT FROM PUBLISHER]

How do individual agents enact the institutions that govern collective behavior in a social situation? How do individuals come to share self-enforcing expectations about collective behavior, so that societal rules and constraints have an effect on individual choice? Conventional accounts, such as contract and evolutionary theories or the analysis of conventions and social conflict, cannot explain the origins of social institutions because they do not address the origins of shared and self-enforcing expectations about collective behavior in a social situation. I analyze two separate stages of institutionalization. First, agents must imagine collective intentionality, so that an ‘imagined institution’ entailing a symbolic representation of collective behavior becomes common knowledge. Second, they must ‘enact’ it through shared and self-enforcing expectations on the path of play. In my model, the agents are goal-oriented, so the process is strategic throughout. [ABSTRACT FROM PUBLISHER]

I examine enforcement and capacity building in international cooperation. In a game-theoretic model, a wealthy donor gives foreign aid in exchange for policy implementation by a poor recipient. The recipient has limited capacity to comply with international agreements, so the donor is not sure if cooperation failure is caused by willful disobedience or unintended error. I show that if perceived cooperation failure prompts reciprocal suspension of cooperation, the donor and recipient have a common preference for capacity building. But when the donor can request compensation for perceived cooperation failure, it only chooses to build capacity if cooperation is otherwise impossible. Consequently, the choice of enforcement mechanism shapes capacity building. This result lays a foundation for a genuine synthesis between the enforcement and managerialist schools of compliance. It generates falsifiable hypotheses and explains why reciprocal enforcement, which unfortunately inflicts collateral damage on the victim, is often considered legitimate. [ABSTRACT FROM PUBLISHER]