Two Michigan State University (MSU) scientists have come up with interesting linear compensation and game theory mechanisms to get countries to co-operate on climate change strategies.
The science paper on climate change comes just weeks after a new survey, Sustainable Efforts & Environmental Concerns Around the World Survey, looked at how climate change is no longer the top global warming concern.
The MSU scientists, Profs Thomas Dietz and Jinhua Zhao, who between them have a wealth of experience in the sustainability field, put forward their ideas on how countries can go about co-operating with the goal of reducing greenhouse gas emissions in their paper Paths to Climate Cooperation, which has been published in the early edition of the Proceedings of the National Academy of Sciences this week. Their paper was an invited commentary on a paper published earlier this year – Keeping Climate in Check: A Self-Enforcing Strategy for Cooperation in Public Good Games.
Dietz and Zhao propose using game theory as well as linear compensation – a scalable method of rewards/punishments – to get balanced participation from countries to develop sustainability strategies and participate in programmes to lower their greenhouse gas emissions and act responsibly towards climate change for their own self-preservation, without depending on other nations to take the lead.
“Getting self-interested and often distrustful nations to co-operate is a major obstacle to addressing the climate problem. So far, international agreements have not had much impact on the trajectory of emissions or the concentration of greenhouse gases in the atmosphere.”
They point to game theory as one of the “most powerful tools for making sense of common problems like climate change”.
“The games of game theory are situations in which the outcomes that result from my decisions depend on what you decide to do.”
Taking the case of the atmosphere, and applying game theory, they point out that if one nation bears the costs of reducing greenhouse gas emissions but other nations do not act, the reductions in risk from climate change will not be very substantial, as no single nation can have much effect.
“Additionally, if other nations do not co-operate, my nation will have borne all of the costs of emissions reductions but will not see less risk from climate change. Conversely, if other nations reduce emissions but my nation does not, we receive the benefits of reduced risk without the costs of emissions reductions. The result could be the classic tragedy of the commons in which each nation has incentive to free ride and undertake little or no reduction in emission, and thus, all nations bear substantial risks as the climate warms.”
If we assume that each nation will act rationally in its own self-interest, then the path to reducing climate change risk is to design a set of rules for emissions that countries will agree to because they find the rules beneficial,” explain Dietz and Zhao.
Punishing nations for not meeting GHG targets
While punishments for not meeting greenhouse gas emissions targets are important, the scientists point to how such punishments can prove costly.
“First, nations may choose not to participate if they feel that they will be punished. The substantial uncertainty about some aspects of climate change may make nations leery of committing to binding targets for emissions and punishments for missing those targets.
“Therefore, punishments, although essential for generating compliance, can also lead to pressure to not participate or change an agreement and thus, obviate its benefits,” add Dietz and Zhao.
Linear compensation proposition
Enter linear compensation, or LinC as Dietz and Zhao term it, as a mechanism or type of social psychology model for helping coerce countries to act on climate change, rather than solely punishing them.
According to the two scientists, linear compensation would mean that punishments for not meeting climate change targets could be “adjusted” when compared to how other nations are meeting their sustainability goals.
“Under LinC, if a nation does not meet its reduction target, it does indeed face a punishment – a penalty in the form of an increased target for next year. However, unlike the Kyoto Protocol where the punishment is a fixed multiplier of 1.3 times the shortfall, the LinC punishment is adjusted relative to the performance of other nations. If most other nations also failed to meet their targets (that is, if the average of underperformance is substantially greater than zero), the punishment for each nation is less. In fact, it is proportional to how much below average performance a nation falls. Nations are punished most for being far from the norm of how other nations performed rather than being judged on an absolute basis.”
They add: “Therefore, LinC is an effective way of dealing with our uncertainty about how difficult it will be to reduce emissions. Furthermore, it is well-established in social psychology that descriptive norms – information about how you are doing relative to others in your peer group – are an exceptionally powerful influence on behaviour.”
“A key feature of linear compensation is that if a nation fails to meet its treaty obligations, other nations punish it by reducing their own abatement,” said Zhao in Science Daily. “So each nation has leverage: its own abatement helps make other nations abate more. This is the beauty of the linear compensation mechanism.”
More on the scientists
Dietz, who is vice-chair of the Panel on Advancing the Science of Climate Change of the America’s Climate Choices study, is a professor of sociology and environmental science and policy and assistant vice-president for environmental research at MSU.
Zhao, meanwhile, is a member of the US Environmental Protection Agency Science Advisory Board and the Environmental Economics Advisory Committee. At MSU he is director of the university’s Environmental Science and Policy Program and professor of economics and agricultural, food and resource economics.