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**Introduction**

Climate change presents the world with a social dilemma. We would be better off if we reduced greenhouse-gas emissions, but each of us bears only an infinitesimal share of the cost of our own emissions. So, if we are rational and self-interested, it seems we won’t do anything to reduce our emissions. Smaller-scale social dilemmas can be solved if a local or national government imposes a tax or quota on the harmful activity, but the absence of a global government means that the problem of climate change cannot easily be solved in this way. Even the largest countries bear only a small share of the cost of their emissions (about 15 percent) and small countries bear a negligible share. [1] So national governments acting in the interests of rational and self-interested citizens seem unlikely to do much to reduce emissions in their respective countries. Although they may sign international agreements to limit emissions, pressures from rational and self-interested citizens seem likely to discourage them from enforcing any agreement that requires costly changes.

This pessimistic view is consistent with the fact that global greenhouse-gas emissions are continuing to rise, despite a growing consensus that they are dangerous and numerous calls to cut them. Yet it is inconsistent with the fact that many people seem to be voluntarily reducing emissions at some personal cost (e.g., Chafe and French 2008). Some are prepared to pay more for locally grown food. Some prefer to buy more-expensive power from retailers that generate power from renewable sources. Others purchase carbon credits to offset the emissions caused by their air travel. Responding to these concerns, and those of some employees and investors, many businesses are also reducing or offsetting emissions, even when they are under no legal obligation to do so. Some facilitate the purchase of offsets by their customers. Others get certified as carbon neutral.
Some governments, too, have taken unilateral actions to reduce emissions. Of course, most of the sacrifices people make are small, and it’s hard to know how significant they are in aggregate, but their very existence is puzzling if we assume that self-interest and rationality will lead people to do nothing.

To understand why people might voluntarily reduce emissions and urge businesses and governments to do the same, we can look at research on cooperation in other social dilemmas in which cooperation is socially beneficial but is, or appears to be, individually costly. The last two decades have seen a proliferation of such research in disciplines as diverse as biology, economics, psychology, and anthropology. Although the emphasis of the research varies from discipline to discipline, much of it is united not only by a common theme but also by common use of the language and concepts of game theory— or, as it might better be called, “interactive decision theory” (Aumann 1987).

1 In 2000, the most recent year for which comprehensive data are available, the largest emitter was the United States, which had an estimated 14.91% of global emissions. The European Union had an estimated 11.23% of global emissions.

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Herrmann and his colleagues find that the punishment of cooperators is more common in countries with weak norms of civic cooperation and a weak rule of law. They conclude: “punishment opportunities are socially beneficial only if complemented by strong social norms of cooperation” (p. 1362).

**Cooperative norms combined with taxes or quotas**

The research reviewed here shows that people are better at cooperating in social dilemmas than might be expected. Some mixture of enlightened self-interest and cooperative norms often allows them to avoid the worst, even when governments haven’t imposed taxes or regulations that align individual interests with social interests. Because it is difficult for national governments to address the problem of climate change, the partial efficacy of voluntary individual action might give rise to qualified optimism: perhaps a combination of imperfect voluntary cooperation and imperfect taxes and quotas will together get us close to solving the problem.

But other research shows that the two things need not reinforce each other (Bowles 2008; Fehr and Rockenbach 2008; Frey 1997; Gintis _et al_ 2005). In particular, material incentives designed to encourage cooperation may reduce the effectiveness of cooperative norms. A striking illustration in a different domain comes from a study of a group of day-care centers in Israel that imposed a fine on parents who were late collecting their children and found that parents became even less punctual (Gneezy and Rustichini 2000). Parents may have thought of the fine as a price and may have come to view being late as a service that they could purchase, not as a violation of norm against inconveniencing others.

Something similar happened in the common-pool-resource experiment in rural Colombia, the first stage of which was described earlier. The main purpose of the experiment was to test whether an imperfectly enforced regulation improved cooperation. So in a second stage half the groups were told that they should take only the socially optimal amount of the resource and that they would be fined if they were audited and found to have taken more. But the subjects were given information that implied that the probability of being audited was low and that the expected-value-maximizing choice was still to take too much. In the first rounds of the second stage, regulation worked well, but after a few rounds people were taking at least as much as before. Cardenas and his colleagues hypothesized that regulation “crowded out group-regarding behavior in favor of greater self-interest” (p. 1731). The other half of the groups continued to play the game without regulation but now had the ability to communicate with each other before making their choice. They cooperated somewhat more than before, and in the contrast to the case of regulation, this improvement endured.

Thus a government intervention that improves material incentives but doesn’t fully align them with the social interest may be worse than no intervention. As John Gowdy writes, “Monetary incentives may actually discourage the kinds of behaviors needed to solve 14


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and quotas among affected parties may have a benefit that goes beyond improving the prospects of passing the necessary legislation.

_More information on emissions_ . A third option is to improve the availability of information on greenhouse-gas emissions. Most mechanisms that support cooperation in other social dilemmas depend on the availability of information about others’ players behavior: consider strategies that specify cooperating if and only if (sufficiently many) others cooperate; strategies that require separately punishing defectors; strategies that specify cooperating with people that have previously cooperated with others; and strategies that use cooperation in a public-good game to build a reputation valuable in other games.
Public information on greenhouse-gas emissions is notably limited. The World Resources Institute’s website, which seems to be the best source of comprehensive national information, contains no information on emissions after 2004, and no comprehensive information is available after 2000. [15] In that year, emissions from sources not reported in later years made up 41 percent of the global total. For Indonesia and Brazil, which had the third and fourth highest levels of estimated emissions in 2000, they made up 90 and 85 percent, respectively, of the national totals.

By contrast, information on inflation, gross-domestic product, and other economic phenomena is often available on a quarterly basis, with a delay of only a few months.
Transparency International promptly publishes annual indicators of corruption. The World Bank promptly publishes annual indicators of the ease of doing business. All these indicators attract attention, create controversy, and influence policy. Climate change needs the equivalent. Moreover, the best information would not only be national. It would also cover finer groupings, such as provinces, cities, and perhaps large firms, as well as facilitating estimates of emissions for representative individuals.

15 See

[http://cait.wri.org](http://cait.wri.org/) (accessed August 2008).

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