This paper demonstrates that cooperation in international environmental negotiations can be explained by preferences for equity. Within a N-country prisoner’s dilemma in which agents can either cooperate or defect, in addition to the standard non-cooperative equilibrium, cooperation of a large fraction or even of all countries can establish a Nash equilibrium. In an emission game, however, where countries can choose their abatement level continuously, equity preferences cannot improve upon the standard inecient Nash-equilibrium. Finally, in a two stage game on coalition formation, the presence of equity-interested countries increases the coalition size and leads to eciency gains. Here, even a stable agreement with full cooperation can be reached.
Lange, Andreas and Carsten Vogt (2001), Cooperation in International Environmental Negotiations due to a Preference for Equity, ZEW Discussion Paper No. 01-14, Mannheim.