Climate Change Solution that Proposes Game Theory
http://www.huffingtonpost.com/2011/09/16/climate-change-solution-game-theory_n_965027.html
This article and related paper discuss a new way about tackling the difficult procedure of dealing with climate change on a global scale. Combining game theory with linear compensation and a social psychology model, this new idea developed by Jobst Heitzig, Kai Lessmann, and Yong Zou seems to be one of the most logical methods for getting UN countries on board with the idea of reducing green house gas emissions. Though accepting punishments when the treaty obligations are not met might be a difficult factor for some nations to accept, this plan might be the most effective way to approach such a topic as this.
Our second topic in the course was, of course, game theory. In this particular game there are several players, which are UN countries (hypothetically). To put the concept in perspective one player is a single country involved in this treaty while the other player is the rest of the countries involved in the treaty. This is the same game for each individual country involved in this treaty. The single country in this game has two options. One is to meet the treaty obligations by reducing green house gas emissions, thus costing capital in the process and most likely deterring economic growth, but avoiding a punishment from the UN. The other option is to fall short of the amount of reduction in the contract and pay a punishment to be adjusted relative to how well the other nations met the emissions goals. Also, if the single country in this game manages to reduce an a larger amount of emissions than the treaty calls for then the countries that don’t meet the treaty requirements will be punished relative to how well this country met it’s emission goals. This game involves much more complexity than any of the examples we had in class because each nation involved is another player added to the game but the overall game is looked at as the individual nation as one player and the rest of the nations as the other player. Maybe I just see all of the possibilities as complicated, I’m sure an economist can clearly see the setup of this game
The second part of this treaty is the most difficult item though. For a country to commit to something that might punish them in the future, they have to be completely behind the end goal of this item, what this treaty is trying to achieve. Hopefully most countries will be willing to take the risk and in the end make our planet a better and more sustained place to live. Personally, I feel that most countries will opt out of something like this because of the effort/capital and restrictions involved in such an agreement. This treaty would add an economic complication to the already difficult situation of staying afloat in these dire economic times. It would be fantastic for countries to start putting forth the effort to keep this planet alive and well and accept punishments for doing the opposite but most governments seem to focus on the here and now while disregarding the distant/near future where this planet is unable to handle our carbon emission anymore. This is a sad realization, hopefully game theory can turn around the outcome.