| Foreword |
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v | |
| Preface |
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ix | |
| About the Author |
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xv | |
| Lecture 1 Two Introductory Notions |
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1 | (20) |
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The purpose and the message |
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2 | (1) |
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1.1 The environment: An economic good? |
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3 | (7) |
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Environment and social sciences |
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3 | (1) |
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Environment and pollution |
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4 | (1) |
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Environment and externalities |
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5 | (1) |
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Externalities as two-dimensional commodities |
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6 | (1) |
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Directional vs. diffuse externalities |
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7 | (1) |
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Unilateral vs. reciprocal and multilateral externalities |
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8 | (1) |
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Local, transboundary and global externalities |
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8 | (1) |
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Externalities and time: Stock and intergenerational externalities |
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9 | (1) |
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1.2 Ecological transfer functions |
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10 | (10) |
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10 | (2) |
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Directional vs. diffuse externalities resulting from alternative transfer functions |
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12 | (1) |
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13 | (1) |
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A directional flow pollutant model: RAINS |
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14 | (2) |
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A diffuse stock pollutant model: The climate module of the RICE model |
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16 | (4) |
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20 | (1) |
| Lecture 2 The Economic-Ecological Reference Model |
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21 | (22) |
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The purpose and the message |
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22 | (1) |
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2.1 Components of the reference model (flow version) |
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23 | (8) |
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Countries and commodities |
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23 | (1) |
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24 | (3) |
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27 | (1) |
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The externality and the transfer function |
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28 | (3) |
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31 | (2) |
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31 | (1) |
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32 | (1) |
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2.3 A compact form of the reference model |
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33 | (2) |
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2.4 Adaptation and protection |
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35 | (4) |
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2.5 Two apologetic warnings |
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39 | (2) |
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39 | (1) |
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40 | (1) |
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41 | (2) |
| Lecture 3 Economic Theory Concepts |
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43 | (56) |
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The purpose and the message |
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44 | (1) |
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45 | (12) |
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Alternative individual country behaviors |
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45 | (7) |
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"Business as usual" (BAU) behavior |
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46 | (1) |
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Individual environmentally nationalistic behavior |
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47 | (1) |
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Standard economic properties of an individual environmentally nationalistic equilibrium |
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48 | (2) |
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Other general properties of an individual environmentally nationalistic equilibrium |
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50 | (2) |
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52 | (4) |
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The "Business as usual" international equilibrium |
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52 | (1) |
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The international environmentally nationalistic equilibrium |
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53 | (1) |
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Standard economic properties of an international environmentally nationalistic equilibrium |
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53 | (1) |
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Other general properties of an environmentally nationalistic international equilibrium |
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54 | (2) |
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Equilibria and the right to pollute |
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56 | (1) |
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57 | (11) |
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57 | (6) |
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Economic properties of an efficient state |
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59 | (2) |
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Other general properties of an efficient state |
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61 | (2) |
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Multiple efficient states |
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63 | (3) |
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Efficiency and the right to pollute |
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66 | (1) |
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67 | (1) |
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3.3 The rationale for cooperation |
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68 | (9) |
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Inefficiency and environmental abuse of equilibria with externalities |
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68 | (4) |
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The ecological surplus to be shared |
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72 | (5) |
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3.4 Modalities of cooperation |
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77 | (10) |
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Who owns the right to pollute internationally? |
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77 | (7) |
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The assignment of rights issue |
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77 | (4) |
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81 | (1) |
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Rights vs. responsibility |
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82 | (2) |
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84 | (3) |
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84 | (1) |
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85 | (2) |
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3.5 Obstacles to cooperation |
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87 | (8) |
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The informational problems |
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87 | (7) |
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The value of "environmental" goods |
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87 | (1) |
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The extreme difficulty of measurement |
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88 | (1) |
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89 | (2) |
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91 | (1) |
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Informational free riding |
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92 | (2) |
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Non-participatory free riding |
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94 | (1) |
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3.6 Concluding summary and problems left open |
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95 | (2) |
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Annex: Analytical formulation of the one polluter (r)-one pollutee (e) reference model |
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97 | (2) |
| Lecture 4 Game Theory Concepts |
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99 | (30) |
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The purpose and the message |
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100 | (1) |
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4.1 Strategic games in general |
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101 | (4) |
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4.2 Equilibrium concepts in strategic games |
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105 | (8) |
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105 | (2) |
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Dominant strategy equilibrium |
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107 | (1) |
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Coalitions and transferable utility |
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108 | (3) |
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108 | (2) |
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Transferable vs. non-transferable utility |
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110 | (1) |
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Partially cooperative Nash equilibrium relative to a coalition |
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111 | (2) |
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4.3 Coalitional functions and the cooperative game form |
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113 | (2) |
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Coalitional functions in general |
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113 | (2) |
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The γ-corecoalitional function |
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115 | (1) |
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4.4 Cores and other solution concepts for cooperative games with externalities |
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115 | (10) |
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116 | (1) |
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117 | (5) |
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Alternative coalitional functions and cores |
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122 | (2) |
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Alternative solution concepts |
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124 | (1) |
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4.5 Virtues of the core solution |
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125 | (4) |
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On cores of games without externalities |
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125 | (1) |
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On γ-cores for games with externalities |
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126 | (3) |
| Lecture 5 The Global Externality Game I: Its γ-core |
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129 | (58) |
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The purpose and the message |
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130 | (1) |
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5.1 Introducing the global externality game |
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131 | (10) |
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Associating games with economic models |
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131 | (1) |
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Formulation of the global externality game (GEG) |
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132 | (3) |
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Antecedents: Select literature on games with environmental externalities prior to 2001 |
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135 | (6) |
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5.2 Equilibrium concepts in the GEG |
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141 | (12) |
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Non-cooperative Nash equilibrium (NONE) |
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141 | (48) |
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Behavioral economic and environmental characteristics |
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142 | (1) |
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Mathematical properties and their significance |
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143 | (2) |
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143 | (1) |
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144 | (1) |
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Dominant strategy equilibrium |
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145 | (1) |
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145 | (1) |
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145 | (2) |
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Transferable vs. non-transferable utility |
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147 | (1) |
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Partially cooperative Nash equilibria (PONE) |
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147 | (1) |
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148 | (1) |
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148 | (1) |
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149 | (1) |
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Environmental properties: Characteristics of the emissions |
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149 | (4) |
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5.3 The efficient outcomes of the GEG |
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153 | (2) |
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The r γ-corecoalitional function |
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153 | (1) |
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The Pareto efficient outcome |
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154 | (1) |
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The imputations set and alternative cooperative outcomes |
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154 | (1) |
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5.4 The γ-core of the GEG: Definition and existence in a qualitative sense |
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155 | (11) |
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Helm's balancedness result |
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156 | (8) |
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Non-uniqueness and extensions |
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164 | (2) |
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166 | (1) |
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Annex 1: The "lake game" of Shapley and Shubik as a "global externality game" |
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166 | (11) |
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Annex 2: The "prisoners' dilemma" game and international environmental externalities |
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177 | (4) |
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Annex 3: The γ-coalitional function of the GEG is not superadditive: An example |
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181 | (2) |
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Annex 4: A crucial step in Helm's balancedness proof |
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183 | (4) |
| Lecture 6 The Global Externality Game II: Its CT Solution |
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187 | (40) |
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The purpose and the message |
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188 | (1) |
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6.1 The CT solution: A computable strategy and imputation in the 7-core of the GEG |
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189 | (14) |
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189 | (6) |
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195 | (6) |
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201 | (2) |
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6.2 Environmental and general economic characteristics |
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203 | (5) |
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The γ-core and the optimal level of pollution |
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203 | (1) |
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The γ-core and economic theory |
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204 | (4) |
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Externalities vs. public goods |
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204 | (1) |
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Which optimum among the many? |
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205 | (1) |
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An amendment to the Coase theorem in the case of international externalities |
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206 | (2) |
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6.3 Specific properties of the CT solution |
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208 | (13) |
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Exhibiting the transfers implicit in the solution |
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208 | (4) |
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208 | (1) |
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The economic significance |
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209 | (3) |
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How is the ecological surplus being shared at the CT solution? |
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212 | (3) |
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The respective positions of polluters vs. pollutees at the CT solution: Graphical illustration |
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213 | (1) |
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The game with 1 polluter and 2 pollutees |
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213 | (2) |
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The game with 2 polluters and 1 pollutee |
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215 | (1) |
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Do polluters pay at the CT solution? |
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215 | (2) |
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The CT solution and the benefit principle of public finance |
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217 | (1) |
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On free riding and γ-core stability |
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218 | (3) |
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a Free,riding vs. blocking |
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218 | (1) |
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b The - γ-coreassumption and coalition formation |
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219 | (1) |
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c Preference revelation free riding and the CT solution |
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220 | (1) |
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6.4 Whither the γ-corecore solution for the GEG? |
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221 | (6) |
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On the nature of the game: A negociation on a diffuse externality |
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221 | (1) |
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222 | (1) |
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The - γ-corestrategies of the non-members |
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223 | (1) |
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The PCNE and the - γ-corecoalitional function |
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223 | (1) |
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The γ-core is self-enforcing |
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224 | (3) |
| Lecture 7 The Dynamic Global Externality Game |
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227 | (62) |
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The purpose and the message |
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228 | (1) |
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7.1 The dynamic economic-ecological reference model |
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229 | (22) |
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229 | (4) |
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229 | (1) |
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230 | (1) |
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Utilities and discounting |
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230 | (2) |
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Disutility of a stock or of a flow? |
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232 | (1) |
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232 | (1) |
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233 | (1) |
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233 | (8) |
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Individual behavior of a country over time |
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233 | (6) |
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235 | (1) |
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Standard economic properties of an individual equilibrium over time |
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236 | (1) |
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Other general properties of an individual equilibrium over time |
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237 | (1) |
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Time profile of the emissions along individual equilibrium path |
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238 | (1) |
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International equilibrium over time |
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239 | (1) |
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Standard economic properties of the international equilibrium over time |
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239 | (1) |
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Other general properties of the international equilibrium over time |
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240 | (1) |
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Time profile of the stock along the international equilibrium path |
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240 | (1) |
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Intertemporal international efficiency |
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241 | (8) |
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243 | (1) |
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Standard economic properties of an efficient path |
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244 | (2) |
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Other general properties of an efficient state |
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246 | (1) |
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Multiple efficient outcomes |
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246 | (2) |
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Time profiles of the emissions and the stock along the efficient path |
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248 | (1) |
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The rationale for cooperation in the dynamic setting |
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249 | (2) |
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7.2 The associated dynamic global externality game |
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251 | (3) |
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Formulation of the dynamic global externality game (DGEG) |
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251 | (1) |
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Antecedents and alternative categories of dynamic games |
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252 | (2) |
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7.3 Equilibrium concepts in the DGEG |
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254 | (7) |
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Non-cooperative Nash equilibrium paths |
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254 | (5) |
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255 | (2) |
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Other properties of the non-cooperative Nash equilibrium path |
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257 | (1) |
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Linear damage functions: Equilibrium in dominant strategies |
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258 | (1) |
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259 | (1) |
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259 | (1) |
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Transferability of utilities |
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259 | (1) |
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Paths of partially cooperative Nash equilibria |
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259 | (2) |
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260 | (1) |
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Behavioral economic and environmental characteristics |
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261 | (1) |
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7.4 Coalitional functions, efficient and alternative cooperative paths |
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261 | (3) |
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The γ-coalitional function, the efficient path, and the imputations set |
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261 | (3) |
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Alternative cooperative paths |
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263 | (1) |
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7.5 The γ-core stable path of the DGEG: Optimal control formulation |
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264 | (3) |
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The optimal control approach |
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264 | (1) |
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265 | (2) |
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265 | (1) |
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Game theoretic considerations |
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266 | (1) |
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7.6 The γ-corecore stable path as a sequence of negotiations: Dynamic programming formulation |
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267 | (18) |
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The GTTZ alternative approach |
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267 | (8) |
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The issue of cooperation vs. non-cooperation in an intertemporal context |
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267 | (1) |
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State variables and value functions: dynamic programming in lieu of optimal control |
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268 | (3) |
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The fallback position and the the Houba-de Zeeuw assumption on expectations |
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271 | (1) |
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Rational expectations games: introducing the concept |
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272 | (2) |
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The argument in general terms and existence |
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274 | (1) |
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The cooperative solution of the dynamic global environmental game |
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275 | (16) |
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275 | (1) |
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Computing the solution by backward induction - Linear damage functions |
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276 | (4) |
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The infinite horizon case |
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280 | (5) |
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7.7 Concluding considerations |
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285 | (4) |
| Lecture 8 The Dynamic Global Externality Game in Numbers: The CWS Model |
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289 | (40) |
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The purpose and the message |
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290 | (1) |
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8.1 The ClimNeg World Simulation (CWS) model |
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291 | (15) |
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Informal description of purpose, vocabulary and origin |
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291 | (2) |
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293 | (4) |
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297 | (4) |
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Reducing the economic-ecological model to its decision variables |
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298 | (1) |
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Specifying the dynamic game |
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299 | (2) |
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301 | (8) |
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Description of the BAUE, NONE, PCNE's, PESP and CS scenarios |
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302 | (2) |
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The optimization problems and their solutions |
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304 | (2) |
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8.2 Key numerical results |
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306 | (3) |
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8.3 Cooperation beyond efficiency in the CWS model |
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309 | (16) |
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Efficient utility levels at the time horizon and the ecological surplus |
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309 | (1) |
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Individual and coalitional blockings of the Pareto efficient scenario |
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310 | (1) |
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Transfers inducing cooperation |
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311 | (8) |
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314 | (1) |
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315 | (1) |
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Transfers in the CWS game vs. in the DGEG |
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316 | (3) |
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319 | (14) |
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On the ecological surplus |
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319 | (1) |
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319 | (1) |
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Pre-transfer surplus sharing |
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320 | (1) |
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Cooperation-enhancing surplus sharing |
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321 | (1) |
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CT transfers in CWS and time: The feasibility issue |
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321 | (2) |
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On distributional equity and responsibility in the CT solution |
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323 | (1) |
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The CT solution and the ability to pay principle of public finance |
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324 | (1) |
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The computational nature of the CT solution |
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324 | (1) |
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8.4 An example of policy use of CWS and its associated game |
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325 | (2) |
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8.5 Concluding consideration |
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327 | (2) |
| Lecture 9 Internal Coalitional Stability and the Global Externality Game |
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329 | (26) |
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The purpose and the message |
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330 | (1) |
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9.1 An alternative theory of coalitional stability |
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331 | (1) |
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9.2 The "internal and external" stability concepts: An informal presentation |
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332 | (1) |
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9.3 Internal coalitional stability in the GEG |
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333 | (19) |
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Coalitional externality and coalitional free riding |
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333 | (9) |
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The equilibrium size of the coalitional externality |
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335 | (4) |
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"Outside option payoff" and possible outcomes of negotiations |
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339 | (1) |
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Properties of an equilibrium with one free riding player |
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340 | (2) |
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Equilibria with multiple free riding players: Problems |
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342 | (9) |
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342 | (3) |
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A chain of contradictory expectations |
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345 | (1) |
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Analytical exploration of more general cases |
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346 | (5) |
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Numerical experiments with CWS |
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351 | (1) |
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9.4 Concluding considerations |
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352 | (3) |
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On the scope of the internal coalitional stability concept |
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352 | (1) |
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On achieving cooperation: By surplus grabbing vs. surplus sharing? |
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353 | (1) |
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On internal vs. γ-core stability and efficiency |
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353 | (2) |
| Lecture 10 The UNFCCC Process: An Economic and Game Theoretic Interpretation |
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355 | (49) |
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The purpose and the message |
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356 | (1) |
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357 | (1) |
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From science to policy and diplomacy |
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357 | (1) |
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10.1 The United Nations framework convention on climate change, Rio 1992 |
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358 | (2) |
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10.2 The Kyoto Protocol, 1997 |
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360 | (15) |
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Main features of the Protocol |
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361 | (1) |
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Economic and game theoretic ideas supporting the Protocol |
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362 | (13) |
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The cap and trade scheme in the reference model |
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362 | (1) |
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Efficiency and coalitional stability: A reminder on the role of transfers |
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363 | (2) |
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Competitive emissions trading in lieu of transfers |
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365 | (4) |
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Agreeing on reference emissions |
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369 | (1) |
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Showing the efficiency and coalitional stability of the trading equilibrium |
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370 | (2) |
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Desirability of free trade in emissions |
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372 | (2) |
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JI and CDM as alternative forms of emissions trading |
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374 | (1) |
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10.3 Appraising the first commitment period: 2005-2012 |
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375 | (13) |
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Game theoretic interpretation of the post-ratification situation |
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375 | (4) |
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The appropriate solution concept |
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376 | (1) |
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On efficiency and coalitional stability of the prevailing situation |
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377 | (2) |
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379 | (1) |
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Reflections in the wake of Kyoto, as of 2012 |
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379 | (8) |
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The sequence of time intervals |
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380 | (1) |
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380 | (1) |
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381 | (1) |
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Emissions abatement vs. temperature change |
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382 | (1) |
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A fragmented vs. global world climate regime? |
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383 | (1) |
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The participation of developing countries |
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384 | (3) |
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Concluding consideration on the Kyoto Protocol |
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387 | (1) |
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10.4 The Durban ADP, the Doha amendment and the second commitment period: 2013-2020 |
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388 | (1) |
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10.5 The Paris agreement of December 2015 (COP 21) |
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389 | (15) |
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The grand coalition in sight? |
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390 | (1) |
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391 | (4) |
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Stretching the nature of strategies? |
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391 | (2) |
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Changing the source of strategies |
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393 | (1) |
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Implementing strategies: Stocktake, naming and shaming |
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394 | (1) |
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395 | (4) |
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Equilibrium with subscription |
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395 | (2) |
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PCNEs, climate clubs and little creeks |
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397 | (2) |
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|
|
399 | (2) |
|
On mitigation, adaptation, loss and damage, and transfers |
|
|
401 | (1) |
|
On carbon pricing as an instrument relegated to "voluntary cooperation" |
|
|
402 | (2) |
|
Concluding consideration on the Paris Agreement |
|
|
404 | (1) |
| A conclusion for the course |
|
404 | (3) |
| References |
|
407 | (14) |
| Author Index |
|
421 | (4) |
| Subject Index |
|
425 | |
Lisainfo e-raamatute kohta