International Negotiations on Climate Change: A Non-cooperative Game Analysis of the Kyoto Protocol

We investigate international negotiations on CO2 emissions reduction in the Kyoto Protocol by non-cooperative multilateral bargaining theory. The negotiation model has two phases, (i) allocating emission reductions to countries and (ii) international emissions trading. Anticipating the competitive equilibrium of emissions trading, each country evaluates an agreement of reduction commitments. We formulate the negotiation process as an n-person sequential bargaining game with random proposers. We show that there exists a unique stationary subgame perfect equilibrium of the bargaining game and that the equilibrium emissions reduction proposed by every country converges to the asymmetric Nash bargaining solution as the probability of negotiation failure by rejection goes to zero. The weights of countries in the asymmetric Nash solution are determined by their probabilities to be selected as proposers. Finally, we present numerical results based on actual emission data on the European Union (EU), the former Soviet Union (FSU), Japan and the United States (USA).asymmetric Nash bargaining solution, CO2 emissions trading, international negotiations, Kyoto Protocol, non-cooperative bargaining games

Multiplicity and Sensitivity of Stochastically Stable Equilibria in Coordination Games

We investigate the equilibrium selection problem in n-person binary coordination games by means of the adaptive play with mistakes (Young 1993). We show that whenever the difference between the deviation losses of respective equilibria is not overwhelming, the stochastic stability exhibits a notable dependence on payoff parameters associated with strategy profiles where the numbers of players for the respective strategies are nearly equal. This feature necessitates the existence of games that possess multiple stochastically stable equilibria.Equilibrium selection, stochastic stability, unanimity game, coordination game

Stochastically Stable Equilibria in Coordination Games with Multiple Populations

We investigate the equilibrium selection problem in n-person binary coordination games by means of adaptive play with mistakes (Young 1993). The size and the depth of a particular type of basins of attraction are found to be the main factors in determining the selection outcome. The main result shows that if a strategy has the larger basin of attraction, and if it is deep enough, then the strategy constitutes a stochastically stable equilibrium. The existence of games with multiple stochastically stable equilibria is an immediate consequence of the result. We explicitly address the qualitative difference between selection results in multi-dimensional stochastic evolution models and those in single dimensional models, and shed some light on the source of the difference.Equilibrium selection, stochastic stability, unanimity game, coordination game

Multiple Stochastically Stable Equilibria in Coordination Games

In an (n,m)-coordination game, each of the n players has two alternative strategies. A strategy generates positive payoff only if there are at least m-1 others who choose the same, where m>n/2. The payoff is nondecreasing in the number of such others so that there are exactly two strict equilibria. Applying the adaptive play with mistakes (Young 1993) to (n,m)-coordination games, we point out potential complications inherent in many-person games. Focusing on games that admit simple analysis, we show that there is a nonempty open set of (n,m)-coordination games that possess multiple stochastically stable equilibria, which may be Pareto ranked, if and only if m>(n+3)/2, which in turn is equivalent to the condition that there is a strategy profile against which every player has alternative best responses.Equilibrium selection, stochastic stability, unanimity game, coordination game, collective decision making

Improvement of piezoresistance properties of silicon carbide ceramics through co-doping of aluminum nitride and nitrogen

The piezoresistance coefficient was measured on co-doped silicon carbide ceramics. Evaluation samples of alpha-silicon carbide ceramics were first fabricated by glass capsule HIP method using powder mixture of silicon carbide and aluminum nitride with various ratios. The resultant aluminum nitride added silicon carbide ceramics were doped with nitrogen by changing the post-HIP nitrogen gas pressure. The lattice parameter increased with the amount of adding aluminum nitride indicating that the incorporated aluminum substituted smaller silicon atoms. After post-HIP treatment, lattice parameter then decreased with nitrogen gas pressure. The piezoresistive coefficient increased with the addition of aluminum nitride, it further increased with the nitrogen doping pressure

Institution Formation in Public Goods Games

Centralized sanctioning institutions are of utmost importance for overcoming free-riding tendencies and enforcing outcomes that maximize group welfare in social dilemma situations. However, little is known about how such institutions come into existence. In this paper we investigate, both theoretically and experimentally, the endogenous formation of institutions in a public goods game. Our theoretical analysis shows that players may form sanctioning institutions in equilibrium, including those where institutions govern only a subset of players. The experiment confirms that institutions are formed frequently as well as that institution formation has a positive impact on cooperation rates and group welfare. However, the data clearly reveal that players are unwilling to implement institutions in which some players have the opportunity to free ride. In sum, our results show that individuals are willing and able to create sanctioning institutions, but that the institution formation process is guided by behavioral principles not taken into account by standard theory.microeconomics ;

Institution Formation in Public Goods Games

Centralized sanctioning institutions are of utmost importance for overcoming free-riding tendencies and enforcing outcomes that maximize group welfare in social dilemma situations. However, little is known about how such institutions come into existence. In this paper we investigate, both theoretically and experimentally, the endogenous formation of institutions in a public goods game. Our theoretical analysis shows that players may form sanctioning institutions in equilibrium, including those where institutions govern only a subset of players. The experiment confirms that institutions are formed frequently as well as that institution formation has a positive impact on cooperation rates and group welfare. However, the data clearly reveal that players are unwilling to implement institutions in which some players have the opportunity to free ride. In sum, our results show that individuals are willing and able to create sanctioning institutions, but that the institution formation process is guided by behavioral principles not taken into account by standard theory.public goods, institutions, sanctions, cooperation

Non-cooperative Bargaining and the Incomplete Information Core

We consider information transmission in the core of an exchange economy with incomplete information by non-cooperative bargaining theory. Reformulating the coalitional voting game by Serrano and Vohra [Information transmission in coalitional voting games, J. of Economic Theory (2007), 117-137] so that an informed agent proposes an allocation, we define a notion of the informational core. A coalition has an informational objection to the status-quo allocation if and only if there exists an equilibrium rejection in the coalitional voting game. We present a non-cooperative sequential bargaining game in which coalitional voting games are repeated, and prove that a refinement of a sequential equilibrium of the bargaining game necessarily yields an allocation in the informational core.core, exchange economy, incomplete information, information transmission, non-cooperative bargaining