Making an Agreement Stick

This chapter discusses the concepts of negotiations: how to have a Pareto improving outcome, how to have an efficient agreement, how to mitigate carbon dioxide and other greenhouse gas emissions at a low cost, how to ensure fairness, and how to promote learning, etc. Professor Sachs discusses how to make an agreement stick and uses the prisoner’s dilemma of game theory to talk about strategies of parties in a negotiation. What is said in formal game theory is that the business-as-usual path is the dominant equilibrium of the game, although it is not the best outcome for either player, in the paradox of the prisoner’s dilemma. The question in cooperation is therefore to not only identify the Pareto-improving pathway, but to insure that the countries, once they have agreed upon it, cannot renege upon it. There must be incentives to remain in the contract and means of enforcement in the contract.

This video is part of the module The Main Challenges of Climate Change Negotiations.