Battling Climate Change, by supplying Global Public Goods: How a Successful Coalition can be Built and Maintained

Nearly all countries agree on the need for policy measures to battle climate change. This was the outcome of the United Nations Climate Change conference in Paris in 2015. During that conference almost all countries on the globe committed to take part in an international coalition by agreeing to take measures on a national level to curb a global problem. But why do countries join such a coalition? How was the negotiation result achieved? And how (if at all) can rule breakers be punished? These are the questions this Paper will try to answer. Countries differ in their need and wishes to curb climate change. This can be due to their geographical location or the presence of polluting industrial activities. Paradoxically the developed countries in North-America and Europe exhibit a low risk when temperatures and sea levels rise while they are the main contributors to global warming. Public good theory suggests that a public good is in danger of being underprovided, especially when the benefits of the provision are hard to measure and when interests of contributing partners are diverse. In addition to this, agreements on climate change are made on a strict voluntary basis without any specified penalty when rules are broken. This paper discusses whether the current international system that battles climate change avoids the pitfalls associated with public good provision. We argue that, through issue linkage and polycentric governance, provision levels can be much higher than public good theory alone suggests. This Paper builds on the state-of-the-art literature on coalition building by using game theoretical insights and econometrics. This paper will shed more light on why countries would choose to enter a coalition, how successful negotiation results can be achieved and how participants are refrained from breaking the rules while there is no direct visible penalty.