The Corona-Pandemic: A Game-Theoretic Perspective on Regional and Global Governance

Alejandro Caparrós, Michael Finus

Research output: Contribution to journalArticle

Abstract

We argue that the incentive structure of all individual and coordinated measures across countries to contain the corona-pandemic is that of a weakest-link public good game. We discuss a selection of theoretical and experimental key results of weakest-link games and interpret them in the light of the corona-pandemic. First, we highlight that experimental evidence does not support the assumption that coordination can be trivially solved, even among symmetric players. Second, we argue that for asymmetric countries the weakest-link game does not only pose a problem of coordination, but also a problem of cooperation. Third, we show how and under which conditions self-enforcing treaties can foster coordination and cooperation. We account for the possibility that countries make mistakes when choosing their actions. Our discussion shows that North–South cooperation is relevant and likely to be self-enforcing and that regional cooperation, e.g., within the EU, will also be important.

Original languageEnglish
JournalEnvironmental and Resource Economics
Early online date4 Aug 2020
DOIs
Publication statusE-pub ahead of print - 4 Aug 2020

Keywords

  • Cooperation
  • Coordination
  • COVID-19
  • Experiments
  • Game theory
  • Weakest-link game

ASJC Scopus subject areas

  • Economics and Econometrics
  • Management, Monitoring, Policy and Law

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