Week 10 notes
Week 10 notes Polisci110G
Popular in Governing the Global Economy
Popular in Political Science
This 5 page Class Notes was uploaded by Erica Evans on Monday March 14, 2016. The Class Notes belongs to Polisci110G at Stanford University taught by Kenneth Scheve in Fall 2016. Since its upload, it has received 13 views. For similar materials see Governing the Global Economy in Political Science at Stanford University.
Reviews for Week 10 notes
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 03/14/16
3/10/2016 Polisci110G News: ECB – policy to stimulate the economy and increase spending, to help recover from financial crisis. First the value of the Euro fell negative to the dollar, and then it went back up again. Why? President promised not to go into negative interest rates, which gave the market a little more confidence that interest rates would not decrease more. There was more confidence about holding Euros in the future. Case Study: Our Group’s Proposal: • Pros: More likely to get passed. It’s more attractive to Republicans. Least likely to be shut down by judicial system. It’s more efficient. Generates revenue. Can incorporate regional cap and trade systems. Allows for concrete goals and progression over time. • Cons: raises prices for consumers We want to implement a federal cap and trade system that would incorporate existing regional cap and trade programs that have been successful. This would set a limit for ghg emissions and allow companies to buy and sell emissions permits based on their needs. This system is really efficient because industries that can reduce emissions cheaply can do so immediately, and those that have more difficulty can still continue to operate, but they would retain the incentive to reduce emissions over time. The last part of our plan is that we would use government revenue from this program to invest in clean energy development and gradually reduce the cap over time for continuous progress. 1) Politically feasible – based on a market system and allows more freedom 2) Cost effective as opposed to Carbon Tax. Doesn’t hurt consumers as much. Reduce emissions drastically in places where there is little cost to do so. 3) Government revenue invest in renewable energy 4) Can incorporate regional cap and trade programs, RGGI, CCX 5) Can set concrete goals. Can improve over time US Carbon Tax: • US Cap & Trade: • US Sectoral Regulation: • International treaties by sectors. Polisci110G 10/8/2016 Environmental Policy • Environmental Treaties have increased dramatically over the last few decades • Climate change, acid rain, loss of biological diversity, fishing etc. • Usually there is a trans-‐boundary element (international dimension) to the problem. It becomes a transnational negative externality. • IEAs: International Environmental Agreement: “Contract that says pay if you pollute” • Governments allow some pollution that is necessary to produce the goods people want. But they don’t consider negative consequences of production in other countries. • Clean air is non-‐excludable. Non-‐rival. It is a pure global public good. • Ocean fishing – a resource that is rival in consumption in use. But it’s also non-‐excludable. It has international externalities that require international cooperation à an international problem. But we will focus on global public goods. Why do we need IEAs? • Consider a bilateral environmental problem: Classic prisoner’s dilemma • We are presuming there are many environmental problems that take this form. The world would be better off if everyone took action, but any one individual country has no incentive to do that. • With an IEA, there is a punishment imposed so the incentives to abate or pollute become balanced. • So what is hard about IEA’s? • Biggest problem is enforcement. In International politics, there is no world government, and there is no one to enforce the contract. • Incentives to fulfill the contract might change as world prices change • Now consider a 100 player game… the same problem as before basically. • Cooperation problem: ongoing repeated interactions. Reduces risk. • Changes how countries make decisions: • Stage 1: everyone country decides whether or not to sign • Stage 2: If you sign the agreement, the treaty obligates you to choose jointly. What is the best decision for everyone who signed the treaty? • Stage 3: If you didn’t sign the treaty, you choose independently to play abate or pollute. • IEA – equilibrium if it’s self-‐enforcing. If I’m a signatory country, I can’t gain by withdrawing, and non-‐signatory countries can’t gain by joining. • Assume that countries comply with Pollute or Abate choice that they make. • Stage 2 is modeled by the signatories maximizing their aggregate payoff. Countries are not giving up sovereignty; they are exercising their sovereignty. 2-‐Country Model: • Stage 3: You are not a signatory, so you do what is rational for you. You Pollute. • Stage 2: Everyone who signed it is trying to maximize their payoffs. Whether the group decides to pollute or abate depends on how many people signed the treaty. If only one country signed it, they will just pursue their own incentives and they will pollute. If two countries are signatories, both countries abate. • Stage 1: Deciding whether to sign the treaty or not: the signatory signing the treaty weakly dominates not signing the treaty for both of these countries. If there are only 2 countries, it is in their interest to both sign this treaty. 5-‐Country Model: • Stage 3: Every non-‐signatory will Pollute • Stage 2: Depends on number of signatories. If only one country signed, they will pollute. If 2 or more countries are signatories then they do better by playing abate. • If you add up the payoffs of 2,3,4 or 5 countries, then the biggest payoffs are to abate. • The treaty will say this: “The treaty is not in effect until at least 2 countries sign up” • Stage 1: do countries sign up or not? If there is exactly one country already signed up, then the second country is decisive. If two other people have signed up, then it’s not worth it for the third country to sign on, because they are not better off by doing it. • IEA generates more cooperation, but not FULL cooperation. Climate Change: • Greenhouse Gases have played a big role in global warming • We need to reduce CO2 • In order to fix this problem, we need to cooperate for decades. We can’t just solve it in one year. • Location of damages are independent of emissions – so this is a global problem. IEAs in Climate Change: • Generating scientific consensus that there is a problem • It’s only a prisoner’s dilemma if you believe the scientific consensus • Old model: repeated interaction and information, allows countries to punish each other enhances cooperation • New model: maybe what needs to happen is a new set of rules for deciding whether to join the agreement. Then once they are in the agreement, there is a different set of rules for deciding whether to reduce greenhouse emissions or not. • Paris: every country is coming with its promise. You’re bringing your decision to this international forum. • The Paris agreement made a lot of progress, but scientists don’t expect that the agreements people made will achieve the 2 degree goal. • Countries’ citizens don’t want to address climate change. Politicians have to solve this problem, keeping in mind what their citizens want to do. Two-‐Level Game • Level 1: bargaining between countries/negotiations • Level 2: ratifying the agreement in each country. • Define a “win-‐set” for a given Level 2 constituency as the set of all possible Level 1 agreements that would have majority support Exam: 5 short answer and 2 essays. Distribution is 50/50 Covers the whole quarter, but more of a focus on the second half
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'