Carmen Marchiori

Back to Kyoto? US Participation and the Linkage Between R&D and Climate Cooperation

The US decision not to ratify the Kyoto Protocol and the subsequent outcomes of the Bonn and Marrakech Conferences of the Parties drastically reduce the effectiveness of the Kyoto Protocol in controlling GHG emissions. The reason is not only the reduced emission abatement in the US. Lower spillover effects on technology and an increase in Russia’s bargaining power were also induced by the US decision. It is therefore crucial to analyse whether an incentive strategy exists that could induce the US to revise its decision and comply with the Kyoto commitments. One solution, occasionally proposed in literature and in actual policymaking, is to link negotiations on climate change control with decisions concerning international R&D cooperation and technology transfers. This paper explores this idea by analysing on the one hand the incentives for the EU, Japan and Russia to adopt an “issue linkage” strategy, and on the other hand the incentives for the US to join a coalition cooperating both on climate change control and on technological innovation. The extended regime in which cooperation takes place on both dimensions (GHG emissions and R&D) will be examined from the view point of countries’ profitability and free-riding incentives. The effectiveness and credibility of the “issue linkage” strategy will thus be assessed.

Applications of Negotiation Theory to Water Issues

The purpose of the paper is to review the applications of non-cooperative bargaining theory to water related issues � which fall in the category of formal models of negotiation. The ultimate aim is that of, on the one hand, identify the conditions under which agreements are likely to emerge, and their characteristics; and, on the other hand, to support policy makers in devising the �rules of the game� that could help obtain a desired result. Despite the fact that allocation of natural resources, especially of trans-boundary nature, has all the characteristics of a negotiation problem, there are not many applications of formal negotiation theory to the issue. Therefore, this paper first discusses the noncooperative bargaining models applied to water allocation problems found in the literature. Particular attention will be given to those directly modelling the process of negotiation, although some attempts at finding strategies to maintain the efficient allocation solution will also be illustrated. In addition, this paper will focus on Negotiation Support Systems (NSS), developed to support the process of negotiation. This field of research is still relatively new, however, and NSS have not yet found much use in real life negotiation. The paper will conclude by highlighting the key remaining gaps in the literature.

Negotiating on water: insights from non-cooperative bargaining theory

The purpose of this paper is to review the applications of non-cooperative bargaining theory to water management problems. The interest in this subject stems from two considerations: (i) water resources continue to be mismanaged, despite their recognized importance for sustainable development, in particular in developing countries; (ii) negotiated decision making has the potential to improve water management, yet there is still little formal understanding of the forces driving bargaining processes, and applications of formal negotiation theory to water issues are also lacking. This paper surveys the existing non-cooperative bargaining models applied to water management problems, with the purpose of preliminarily assessing whether such a formal approach in the phase of problem exploration and policy formulation can support decision makers in the real world. It is the contention of this paper that the proposed approach may offer direct and indirect support by: shortening the time needed to reach an agreement through the (theoretical) identification of an ‘acceptability space’, and helping select policies which are self-enforcing and, therefore, acceptable.

Endogenous Strategic Issue Linkage in International Negotiations

This paper analyses issue linkage as a way to increase co-operation on issues where incentives to free-ride are strong. The goal is to determine under what conditions players prefer to link negotiations on two different issues rather than to negotiate on the two issues separately. Suppose that players are asked to vote on issue linkage before starting negotiations. Under what conditions would they vote in favour of issue linkage? The answer to this question is not trivial. Issue linkage may indeed increase the number of cooperators on the provision of a public good (a typical issue characterised by strong incentives to free-ride). However, at the same time, issue linkage may reduce the number of cooperating players on the other economic issue which is linked to the provision of a public good. Players therefore face a trade-off. This paper analyses this trade-off within a game-theoretic framework and shows under what conditions issue linkage is players’ equilibrium strategy.

Advances in Negotiation Theory: Bargaining, Coalitions and Fairness

Bargaining is ubiquitous in real life. It is a major dimension of political and business activities. It appears at the international level, when governments negotiate on matters ranging from economic issues (such as the removal of trade barriers), to global security (such as fighting against terrorism) to environmental and related issues (such as climate change control). What factors determine the outcomes of such negotiations? What strategies can help reach an agreement? How should the parties involved divide the gains from cooperation? With whom will one make alliances? The authors address these questions by focusing on a noncooperative approach to negotiations, which is particularly relevant for the study of international negotiations. By reviewing noncooperative bargaining theory, noncooperative coalition theory, and the theory of fair division, they try to identify the connections among these different facets of the same problem in an attempt to facilitate progress toward a unified framework.

Reallocating Water: An Application of Sequential Sharing Rules to Cyprus

Water scarcity has become a major constraint on economic development in many regions of the world and sectoral water reallocation is now widely recognized as an essential step toward the sustainable management of water resources. This paper offers an approach to the reallocation of water among sectors based on sequential sharing rules. An essential feature of this approach is that it takes jointly into account a multiplicity of aspects which are critical to many water reallocation problems, but have often been neglected by the theoretical literature. Such aspects include pre-existing customary (or other) rights, scarcity constraints, the chronological order of sectors’ arrivals and environmental water demand. In doing so, our framework can help achieve a solution which is not only more efficient, but also perceived as legitimate and fair. Sequential sharing rules can be used to support or complement other approaches to water allocation, including those based on water markets. Our framework is illustrated using an application to inter-sectoral water reallocation in Cyprus.

On the Implementation and Performance of Water Rights Buyback Schemes

Governments are increasingly reliant on the reacquisition of water rights as a mechanism for recovering overexploited basins. Yet, serious concerns have recently been raised about the efficacy and operational dimensions of existing programs. Water buyback is typically implemented as the purchase of a fixed quantity of water rights from the agricultural sector at the price set by the Water Authority. This paper seeks to analyze whether the use of water buyback in its current form represents a sensible means of recovering overexploited basins. The results—which are particularly relevant to contexts characterised by poor enforcement regimes and widespread illegal water use—highlight the need for greater scrutiny of current programs and call for additional work to improve the design of reacquisition policies in the context of water resource management.