Abstract
Despite the entry into force of the Kyoto Protocol, the US decision not to comply with its Kyoto commitments seems to drastically undermine the effectiveness of the Protocol in controlling GHG emissions. Therefore, it is important to explore whether there are economic incentives that might help the US to modify its current decision and move to a more environmentally effective climate policy. For example, can an increased participation of developing countries induce the US to effectively participate in the effort to reduce GHG emissions? Is a single emission trading market the appropriate policy framework to increase the signatories of the Kyoto Protocol? This paper addresses the above questions by analysing whether the participation of China in the cooperative effort to control GHG emissions can provide adequate incentives for the US to re-join the Kyoto process and eventually ratify the Kyoto Protocol. This paper analyses three different climate regimes in which China could be involved and assesses the economic incentives for the major world countries and regions to participate in these three regimes. The main conclusion is that the participation of the US in a climate regime is not likely, at least in the short run. The US is more likely to adopt unilateral policies than to join the present Kyoto coalition (even when it includes China). However, a two bloc regime would become the most preferred option if both China and the US, for some political or environmental reasons, decide to cooperate on GHG emission control. If the US decides to cooperate, the climate regime that provides the highest economic incentives to the cooperating countries is the one in which China and the US cooperate bilaterally, with the Annex B−US countries remaining within the Kyoto framework.
Similar content being viewed by others
References
ABC News Online, Kyoto Protocol Gets Boost as China Signs, September 3rd, 2002. Online at http://www.abc.net.au
ABC News Online, Kemp Addresses Earth Summit, Defends Govt Position on Kyoto, September 4th, 2002. Online at http://www.abc.net.au
J. E. Aldy S. Barrett R. Stavins (2003) ArticleTitle‘Thirteen Plus One: A Comparison of Global Climate Policy Architectures’ Climate Policy 3 IssueID4 373–397 Occurrence Handle10.1016/j.clipol.2003.09.004
S. Barrett (2002) Environment and Statecraft Oxford University Press Oxford
S. Barrett R. N. Stavins (2003) ArticleTitle‘Increasing Participation and Compliance in International Climate Change Agreements’ International Environmental Agreements: Politics, Law and Economics 3 IssueID4 349–376 Occurrence Handle10.1023/B:INEA.0000005767.67689.28
Asahi Shimbun, Bureaucratic Battle Raises Hurdle for Emissions Control, February 11th, 2002. Online at http://www.asahi.com/english/op-ed/K2002021100204.html
BBC, Japan Cools on Climate Pact, January 3rd, 2002. Online at http://www.news.bbc.co.uk
C. Böhringer (2003) ArticleTitle‘The Kyoto Protocol: A Review and Perspectives’ Oxford Review of Economic Policy 19 IssueID3 451–466 Occurrence Handle10.1093/oxrep/19.3.451
Böhringer, C. and A. Löschel (2001), ‘Market Power in International Emissions Trading: The Impact of US Withdrawal from the Kyoto Protocol’, ZEW Discussion Paper 01-58, Mannheim
Bosello, F. (2004), ‘Timing and Size of Adaptation, Mitigation and R&D Investments in Climate Policy’, mimeo, FEEM, Milan
B. Buchner C. Carraro I. Cersosimo (2002) ArticleTitle‘Economic Consequences of the US Withdrawal from the Kyoto/Bonn Protocol’ Climate Policy 2 273–292 Occurrence Handle10.1016/S1469-3062(02)00027-X
Buchner, B. and C. Carraro (2003a), ‘Regional and Sub-global Climate Regimes’, forthcoming in C. Carraro and C. Egenhofer, eds., Bottom-up Approaches towards a Global Climate Agreement, E. Elgar
Buchner, B. and C. Carraro (2003b), ‘The Future of the Kyoto Protocol: Some Scenarios’, Report prepared for the ESRI Collaboration Project on Environmental Issues, ESRI, Tokyo
Buchner, B. and C. Carraro (Forthcoming), ‘Economic and Environmental Effectiveness of a Technology-based Climate Regime’, Climate Policy, Forthcoming
Buchner, B., C. Carraro, I. Cersosimo and C. Marchiori (2002), ‘Back to Kyoto? US Participation and the Linkage between R&D and Climate Cooperation’, CESifo Working Paper No. 688 (8). Forthcoming in A. Haurie and L. Viguier, eds., Coupling Climate and Economic Dynamics, Kluwer Academic Publishers
Buchner, B. and S. Dall’Olio (2004), ‘Russia: the Long Road to Ratification’, FEEM Nota di Lavoro 151.04, Milan
P. Buonanno C. Carraro E. Castelnuovo M. Galeotti (2001) ArticleTitle‘Emission Trading Restrictions with Endogenous Technological Change. International Environmental Agreements’ Law Politics Economics 1 IssueID3 395–397
P. Buonanno C. Carraro M. Galeotti (2002) ArticleTitle‘Endogenous Induced Technical Change and the Costs of Kyoto’ Resource and Energy Economics 524 11–35
Christian Science Monitor, Japan irked by US stance on Kyoto. March 12th, 2002. Online at http://www.csmonitor.com/2002/0312/p07s01-woap.html
CO2e.com, Japan plans voluntary emissions regulations: E&E Publishing, January 8th, 2002. Online at http://www.co2e.com
CO2e.com, Japan to ratify Kyoto Pact by late August: Jiji Press, February 13th, 2002. Online at http://www.co2e.com
CO2e.com, Japan, US agree on 15 steps on global warming: Jiji Press, April 5th, 2002. Online at http://www.co2e.com
D. T. Coe E. Helpman (1995) ArticleTitle‘International R&D Spillovers’ European Economic Review 39 859–887 Occurrence Handle10.1016/0014-2921(94)00100-E
Criqui P. and C. Philibert (2003), ‘Capping Emissions and Costs’, in: How to make progress post Kyoto: RFF-IFRI workshop, Paris, 2003/03/19, Institut Français des Relations Internationales; Resources for the Future
Den Elzen, M. G. J. and A. P. G. de Moor (2001), ‘The Bonn Agreement and Marrakesh Accords: An Updated Analysis’, RIVM Report 728001017/2001
Egenhofer, C. and T. Legge (2001), ‘After Marrakech: The Regionalisation of the Kyoto Protocol’, CEPS Commentary
European Commission (2001), Proposal for a Council Decision Concerning the Approval, on Behalf of the European Community, of the Kyoto Protocol to the United Nations Framework Convention on Climate Change and the Joint Fulfilment of Commitments Thereunder, Brussels
Eyckmans, J. and H. Tulkens (2001), ‘Simulating Coalitionally Stable Burden Sharing Agreements for the Climate Change Problem’, CORE Discussion Paper 9926 and CLIMNEG Working Paper 18, Université Catholique de Louvain, Belgium
Financial Times, EU Policies could mean Russia backs out of Kyoto climate agreement – MP, March 22nd 2002. Online at http://www.FT.com/
L. H. Goulder K. Mathai (2000) ArticleTitle‘Optimal CO2 Abatement in the Presence of Induced’ Technological Change’ Journal of Environmental Economics and Management 39 1–38 Occurrence Handle10.1006/jeem.1999.1089
Z. Griliches (1979) ArticleTitle‘Issues in Assessing the Contribution of R&D to Productivity Growth’ Bell Journal of Economics 10 92–116 Occurrence Handle10.2307/3003321
Z. Griliches (1984) R&D, Patents, and Productivity University of Chicago Press Chicago
InstitutionalAuthorNameIPCC (2001) Third Assessment Report Cambridge University Press Cambridge
Japan Today News, Japan seeks help to get US to rejoin Kyoto talks, January 19th, 2002. Online at http://www.japantoday.com
Japan Today News, Japan to Urge Canada to Ratify Kyoto Protocol, February 26th, 2002. Online at http://www.japantoday.com
Japan Today News, Japan, US Discuss Gobal Warming, February 27th, 2002. Online at http://www.japantoday.com
Japan Today News, Japan to Urge US, Russia to Ratify Kyoto pact, June 4th, 2002. Online at http://www.japantoday.com
Kyodo News, Anti-global Warming Bill in Line with Kyoto pact, February 1st, 2002. Online at http://www.kyodo.co.jp
Kyodo News, Australia, Canada may Skip Kyoto Protocol: METI Official, February 21st, 2002. Online at http://www.kyodo.co.jp
Manne, A. and R. Richels (1999), ‘The Kyoto Protocol: A Cost-effective Strategy for Meeting Environmental Objectives?’, in J. Weyant, ed., The Cost of the Kyoto Protocol: A Multi-Model Evaluation., Special Issue of the Energy Journal, 1–24
Manne, A. S. and R. Richels (2001), ‘US Rejection of the Kyoto Protocol: The Impact on Compliance Costs and CO2 Emissions’, Working Paper 01–12, AEI-Brookings Joint Center for Regulatory Studies
W. D. Nordhaus Z. Yang (1996) ArticleTitle‘A Regional Dynamic General-Equilibrium Model of Alternative Climate-Change Strategies’ American Economic Review 4 741–765
Nordhaus, W. D. (1999), ‘Modelling Induced Innovation in Climate-Change Policy’, paper presented at the HASA Workshop on Induced Technological Change and the Environment, Laxenburg, June 21–22
Planet Ark (Reuters), China says Kyoto Pact Benefits Both Rich and Poor, January 18th, 2002. Online at http://www.planetark.org
Planet Ark (Reuters), Brazil Cardoso Wants Bush to Fight for Environment, January 28th, 2002. Online at http://www.planetark.org
RBC Network, Russia to ratify Kyoto Soon, March 11th, 2002 Online at http://www.pointcarbon.com/article_view.php?id=1721
Reuters, Putin Undecided in Kyoto, Snubs UN Appeals, September 29th, 2003. Online at http://www.reuters.com
RFE/RL, Russia: Putin Remarks Start off International Climate Conference on Sour Note, September 29th, 2003. Online at http://www.rferl.org
P. Romer (1990) ArticleTitle‘Endogenous Technological Change’ Journal of Political Economy 94 1002–1037
Stewart, R. and J. Wiener (2003), Reconstructing Climate Policy, American Enterprise Institute Press
Sky News, Australia Warms to Kyoto, September 4th, 2002. Online at http://www.sky.com/
The Age, Australia, US Urged to be Less Selfish, August 30th, 2002. Online at http://www.theage.com.au
The Globe and Mail, Kyoto a Go, PM Says, September 2nd, 2002. Online at http://www.globeandmail.com
The Hindu, US in EU’s Firing Line on Climate Change, October 24th, 2002. Online at http://www.hinduinnet.com
The Hindu, Russia Seeks Commitments on Climate Change, October 31st, 2002. Online at http://www.hinduinnet.com
The International Herald Tribune, Russia Needs the Kyoto Treaty, October 28th, 2003. Online at http://www.iht.com
The Japan Times, Carbon Tax Stuck in Detour to Kyoto, January 17th, 2002. Online at http://www.japantimes.com
The Japan Times, Emissions-trading Plan Put on Back Burner, January 18th, 2002. Online at http://www.japantimes.com
The Japan Times, Activating the Kyoto Treaty, January 21st, 2002. Online at http://www.japantimes.com
The Japan Times, China could Help Japan by Taking its Money and Cutting its Kyoto Target, January 26th, 2002. Online at http://www.japantimes.com
The Japan Times, US–Japan Climate Talks Set for March, February 27th, 2002. Online at http://www.japantimes.com
The Toronto Star, Slow up on Kyoto, OM Told, September 4th, 2002. Online at http://www.thestar.com
The Toronto Star, Chrétien Ratifies Kyoto, December 17th, 2002. Online at http://www.thestar.com
United Nations (2002), ‘Johannesburg Summit 2002: Key outcomes of the summit’
Weyant, J. P. (1997), ‘Technological Change and Climate Policy Modeling’, paper presented at the IIASA Workshop on Induced Technological Change and the Environment, Laxenburg, June 26–27
J. P. Weyant T. Olavson (1999) ArticleTitle‘Issues in Modelling Induced Technological Change in Energy, Environmental, and Climate Policy’ Environmental Modelling and Assessment 4 67–85 Occurrence Handle10.1023/A:1019012317160
Yomiuri Shimbun, Russia may Drag Feet on Kyoto, March 28th, 2002. Online at http://www.yomiuri.co.jp
Zhang, Z. X. (2004), ‘Climate Change Policy’ (Comment on “Practical Climate Change Policy” by Richard B. Steward and Jonathan B. Wiener), Issue in Science and Technology, a publication of the US National Academy of Sciences and the US National Academy of Engineering, Vol. 20, No. 3 (Spring)
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Buchner, B., Carraro, C. ‘US, China and the Economics of Climate Negotiations’. Int Environ Agreements 6, 63–89 (2006). https://doi.org/10.1007/s10784-005-1555-2
Accepted:
Issue Date:
DOI: https://doi.org/10.1007/s10784-005-1555-2