Economic Determinant of Multilateral Environmental Agreements

We examine the economic factors that lead to the formation of multilateral environmental agreements, focusing on the likelihood a pair of countries enters into an agreement as well as the number of agreements they share using a near universe of agreements. Two countries are more likely to have an agreement and have more of them if they are economically larger and of similar economic size, closer in distance, have a preferential trade agreement, and trade more. Results are strongest for agreements involving a small number of countries, consistent with a hypothesis that agreements are formed to manage common pool resources.

• Tibor Besedes

Besedes, T., Johnson, E.P. & Tian, X. “Economic Determinants of Multilateral Environmental Agreements,” International Tax and Public Finance (2020). 

• School of Economics