In the 2030 Agenda for Sustainable Development, Member States express their commitment to protect the planet from degradation and take urgent action on climate change. The Agenda also identifies, in its paragraph 14, climate change as “one of the greatest challenges of our time” and worries about “its adverse impacts undermine the ability of all countries to achieve sustainable development. Increases in global temperature, sea level rise, ocean acidification and other climate change impacts are seriously affecting coastal areas and low-lying coastal countries, including many least developed countries and Small Island Developing States. The survival of many societies, and of the biological support systems of the planet, is at risk”.
to take a game theory spin on climate change . . .
In my model, two countries cosigned a compact with the goal to combat climate change. To cooperate means to observe the agreement and act in good faith. To renege means to break the agreement and to act for oneself. I also added a third option: to cooperate but only somewhat. I think this is a widespread phenomenon when it comes to treaties. It is only natural for countries to take advantage of the leeways in front of the potential benefits. This means that countries may opt for a loose enforcement of certain environmental laws.
When assigning payoffs, I looked at the outcomes in a twofold way: the amount of effort it takes to cooperate and the gain from the effect. If both cooperate, then the environment is protected and both will benefit. If both renege, then the environment is damaged and both will suffer. If country 1 cooperates and country 2 reneges, then country 1, acting in good faith but betrayed, will take damage from the extra effort they put in, whereas country 2 will gain by not contributing but sitting on the other’s effort. A perfunctory cooperation amounts to less effort and less benefit, and I assigned the payoffs accordingly.
No nash equilibrium.
The absolute optimal outcome is when both countries cooperate. But it is not a stable outcome since both players have incentives to deviate unilaterally. According to the graph, secondary pareto optimal solutions are (5,3) and (3,5) when one country cooperates and another cooperates perfunctorily.
Takeaway of the day
It takes a collective effort to combat a problem as universal and threatening as climate change. Unilateral contribution, just like unilateral damage, is inconsequential. Therefore, countries sign compacts with each other in hopes for a sense of solidarity in the fight against climate change. However, gentlemen’s agreements seldom work in their intended way. Players in this game always have the option to not carry out the promise. In light of such a reality, I designed the aforementioned matrix. The payoff to each outcome is a representation of the effort it takes to observe the compact (or not) as well as impact of such decisions.
One extra addendum to this game that can potentially increase the possibility of achieving pareto optimality is for the countries to release statements that put their respective reputations on the line. They can also allow the press to check on their status with regard to the compact. Thus, when a country violate the compact, it is in fact risking its own standing in the international community. I believe this would act as an effective deterrent.
Act in good faith is essential to preserving our planet and in effect, ourselves!
Germantown Friends School ’20
I write cathartically. I have been a diligent violinist since I watched Whiplash. I sustain on the Spotify playlists my friend made for me. My favorite film is Babel. I guess I am an agnostic.