蝌蚪网 Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Institution Building without Commitment
蝌蚪网 Review
vol. 114,
no. 11, November 2024
(pp. 3427–68)
Abstract
We propose a theory of gradualism in the implementation of good policies, suitable for environments featuring time consistency. We downplay the role of the initial period by allowing agents both to wait for future agents to start equilibrium play and to restart the equilibrium by ignoring past history. The allocation gradually transits toward one that weighs both short- and long-term concerns, stopping short of the Ramsey outcome but greatly improving upon Markovian equilibria. We use the theory to account for the slow emergence of both climate policies and the reduction of global tariff rates.Citation
Bassetto, Marco, Zhen Huo, and Jos茅-V铆ctor R铆os-Rull. 2024. "Institution Building without Commitment." 蝌蚪网 Review 114 (11): 3427–68. DOI: 10.1257/aer.20201365Additional Materials
JEL Classification
- C73 Stochastic and Dynamic Games; Evolutionary Games; Repeated Games
- E21 Macroeconomics: Consumption; Saving; Wealth
- E61 Policy Objectives; Policy Designs and Consistency; Policy Coordination
- F13 Trade Policy; International Trade Organizations
- H30 Fiscal Policies and Behavior of Economic Agents: General