We study the impact of domestic policy constraints on the optimal terms of international environmental agreements (IEAs). We combine the literature on IEAs with the one on two-level games and distinguish between representatives who negotiate the agreement and a second domestic player who may be involved in the ratification process, in the formulation of the unilateral domestic policy, or in both. We study how uncertainty with respect to the preferences of this second domestic player affects the commitment level required by the agreement. We find a non-monotonic impact: for increasing variance of the ratifiers’ preference, the commitment level that is specified in the agreement may first decrease, before, for sufficiently large variance, increasing again towards the level that is preferred by the negotiators.
We study the impact of domestic policy constraints on the optimal terms of international environmental agreements (IEAs). We combine the literature on IEAs with the one on two-level games and distinguish between representatives who negotiate the agreement and a second domestic player who may be involved in the ratification process, in the formulation of the unilateral domestic policy, or in both. We study how uncertainty with respect to the preferences of this second domestic player affects the commitment level required by the agreement. We find a non-monotonic impact: for increasing variance of the ratifiers’ preference, the commitment level that is specified in the agreement may first decrease, before, for sufficiently large variance, increasing again towards the level that is preferred by the negotiators.