International Treaties on Global Pollution: a Dynamic Time-Path Analysis.

In this paper we show that the formation of coalitions by subsets of countries might diminish the likelihood of a successful world-wide treaty on global pollution. Non-member countries may be less willing to sign a world-wide treaty than they would be in the absence of such coalitions. In fact, the coalition formation may raise the reservation utility of non-member countries above the world-wide treaty level and thus take away their incentives to sign it.