Tradable permits are celebrated as a political instrument since they allow (i) firms to equalize marginal abatement costs through trade and (ii) the government to distribute the burden of the policy in a politically fair and feasible way. These two concerns, however, conflict in a dynamic...

Every government that controls an exhaustible resource must decide whether to exploit it or to conserve and thereby let the subsequent government decide whether to exploit or conserve. This paper develops a theory of this situation and shows when a small probability that some future government...

Real-world negotiations differ fundamentally from existing bargaining theory. Inspired by the Paris Agreement on climate change, this paper develops a novel bargaining game in which each party quanti.es its own contribution (to a public good, for example), before the set of pledges must be...

I study dynamic private provision of public goods (or bads) when agents (or countries) can invest in cost-reducing technologies and sign incomplete contracts. The model leads to a dynamic common pool problem that is more severe than its static counter-part. Nevertheless, a sequence of short-term...

If a coalition of countries implements climate policies, nonparticipants tend to consume more, pollute more, and invest too little in renewable energy sources. In response, the coalition's equilibrium policy distorts trade and it is not time consistent. By adding a market for the right to...