Two-stage concession game approach for analyzing greenhouse gases emission reduction schemes

Climate change imposes a huge treat on the sustainability of our environment. One of the major reasons for the increasing impacts of climate change is the emission of greenhouse gases. Therefore, cooperative greenhouse gas emission reduction schemes with a general consensus are needed in order to reduce the impacts of climate change. Due to the strong link between greenhouse gas emission and economic development there is disagreement among countries on the designing and implementation of emission reduction plans. In this paper the authors proposed a two-stage concession game to analyze emission reduction plans and determine a balanced emission range that improves the utilities of the bargaining parties. Furthermore the game was applied to a hypothetical example. Our results from the case study indicated that even though the utilities of the bargaining parties is highly affected by emission reductions, after making concessions their utilities can be improved given their emission reductions are within in a certain desirable range. The authors hope that this article provides insights which could be useful for understanding emission reduction plans and their consequences on the negotiating parties.