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In the policy world, the climate challenge is usually understood in spatial, and especially geopolitical, terms.

The Basic Global Storm

We can make sense of this by focusing on three important characteristics. The first is the spatial dispersion of causes and effects. Climate change is a truly global phenomenon. Emissions of greenhouse gases from any geographical location on the Earth’s surface enter the atmosphere and then play a role in affecting climate globally. Hence, their effects are not realized solely at their source, either individual or geographical, but rather are dispersed across all regions of the Earth.

The second characteristic is fragmentation of agency. Climate change is not caused by a single agent, but by a vast number of individuals and institutions (including economic, political, and social institutions) not fully unified by any comprehensive structure of agency. This poses a challenge to humanity’s ability to respond.

In the spatial dimension, fragmentation of agency is usually understood as arising out of the shape of the current global system, dominated by nation states, and in terms of the familiar theoretical model of the prisoner’s dilemma, or what Garrett Hardin calls a “tragedy of the commons.”14 Weisbach and his colleagues also endorse this approach.15

Later I will argue that the standard model is a dangerous misdiagnosis that threatens good policy. However, first let us explain it. The relevance of the prisoner’s dilemma scenario is easiest to show by focusing on a paradigm case: overpollution. Suppose that a number of distinct agents are trying to decide whether or not to engage in a polluting activity. Assume for the moment that each is concerned only with its own interests, narrowly construed, and that the situation can characterized as follows:

  • (PD1) It is collectively rational to cooperate and restrict overall pollution: each agent prefers the outcome produced by everyone restricting its individual pollution over the outcome produced by no one doing so.
  • (PD2) It is individually rational not to restrict one's own pollution: when each agent has the power to decide whether or not it will restrict its pollution, each (rationally) prefers not to do so, whatever the others do.

Agents in such a situation find themselves in a paradoxical position. On the one hand, given (PD1), they understand that it would be better for everyone if every agent cooperated; but, on the other hand, given (PD2), they also all prefer to defect. Paradoxically, then, if all individual agents act rationally in terms of their own interests, then they collectively undermine those interests.

For current purposes, assume that a tragedy of the commons is roughly a prisoner’s dilemma involving a common resource.16 This has become the standard analytical model for understanding large-scale environmental problems, and climate change is no exception. Typically, the reasoning goes as follows. Conceive of climate change as an international problem where the relevant parties are individual countries, who represent the interests of their populations in perpetuity. Then (PD1) and (PD2) appear to hold. Individual states accept that allowing climate change to continue unabated is bad for them, that cooperation is needed to address it, and that it would be in their interests for all to cooperate (i.e., (PD1)). However, each state also believes that when it comes to making its own decisions about what to do, it is better not to cooperate, since this choice is better on strategic grounds (i.e., (PD2)). Specifically, on the one hand, if others cooperate, it is better to defect, since then one can receive the benefits of cooperation (i.e., meaningful reductions in overall climate risk) without having to pay any of the costs; however, on the other hand, if others fail to cooperate, it is also better not to cooperate, since otherwise one would pay costs without receiving the benefits (e.g., since meaningful reductions require cooperation). Unfortunately, this pattern of reasoning leads to a paradoxical result: if each country reasons in the same way, no one cooperates, and each ends up worse off by its own lights than they would if all cooperated. This result is aptly termed a tragedy: the problem seems self-inflicted and the behavior self-destructive.

If climate change is a normal tragedy of the commons, this is challenging, but also encouraging. Given (PD1), there is a sense in which each country should be motivated to find a way out of the paradox, so that all can secure the better, cooperative outcome. Moreover, in the real world, commons problems are often resolvable under certain circumstances, and climate change seems to fit these desid- erata.17 In particular, commons problems are often resolved if the parties benefit from a wider context of interaction; and this appears to be the case with climate, since countries cooperate on a number of broader issues, such as trade and security.

Unfortunately, this brings us to the third characteristic of the basic global storm, institutional inadequacy. The usual means for resolving commons problems under favorable conditions is for the parties to agree to change the existing incentive structure by introducing a system of enforceable sanctions. (Hardin memorably labels this “mutual coercion, mutually agreed upon.”)18 Such a system transforms the decision situation by foreclosing the option of free riding, so that the collectively rational action also becomes individually rational. Theoretically, then, matters seem simple. Nevertheless, in practice the need for enforceable sanctions poses a challenge at the global level because of the limits of our current, largely national, institutions, and the lack of an effective system of global governance. In essence, global regulation of greenhouse gas emissions seems required, including a reliable enforcement mechanism; however, the current global system—or lack of it—renders this difficult, if not impossible.

The standard (spatial) analysis thus suggests that the main thing needed to address climate change is an effective system of global governance (at least for this issue). This is a tall order; still, there is a sense in which it remains good news. In principle at least, it ought to be possible to motivate countries to establish such a regime, since they should recognize that it is in their best interests to eliminate free riding and so make genuine cooperation the rational strategy at the individual (i.e., national) as well as collective (i.e., global) level.

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