On the Effects of an Increase in the Number of Abaters in Pollution Abatement Games
摘要
We study the effects of an increase in the number of abaters in pollution abatement games, first in a static, then in a dynamic (continuous-time) game. In both games, we assume that m countries/agents agree on taking action to reduce the stock of pollution, which is a public bad, whereas \(n-m\) countries free ride on the abatement levels of the abaters. Moreover, we assume that abaters can either coordinate on their contributions or not. In the static game, both in the coordination and the non-coordination scenario, an increase in m leads to a decrease in the stock of pollution and to an increase in social welfare. In the dynamic game, instead, both in the coordination and the non-coordination scenario, an increase in m may result in a higher steady-state stock of pollution and a lower social welfare, depending on the “business-as-usual” level of output.