Cooperative climate action under background risk

Area of Science:

• Behavioral Economics
• Climate Science
• Environmental Policy

Background:

• Climate change action faces a collective-risk social dilemma, where individual costs for mitigation are high and benefits are shared globally.
• Economic theory suggests background risks (geopolitical instability, pandemics) may decrease individual contributions to collective climate protection.
• Growing uncertainties raise concerns that external risks could undermine urgent climate cooperation.

Purpose of the Study:

• To investigate the impact of background risk on collective action for climate protection.
• To test the prediction that increased background risk reduces contributions to climate mitigation efforts.
• To examine whether climate cooperation can be sustained despite external uncertainties.

Main Methods:

• An economic laboratory experiment was designed using a threshold Public Goods Game.
• Treatments incorporated background risk, with participant decisions linked to real carbon offset purchases.
• The study analyzed how background risk influences the likelihood of achieving collective climate goals.

Main Results:

• Contrary to theoretical predictions, background risk did not systematically decrease the likelihood of reaching collective climate goals.
• The experimental results indicate that individuals may still cooperate on climate action despite facing background uncertainties.
• The findings suggest that the negative impact of background risk on climate cooperation might be less severe than anticipated.

Conclusions:

• Concerns that background risk may undermine climate action may be overstated under specific conditions.
• Effective communication of climate risks and strong cooperation incentives can bolster collective climate efforts.
• This research provides valuable insights for policymakers aiming to foster climate cooperation in uncertain times.