If a bi-lateral international agreement partially moves to a victim pays principled (VPP) for a given level of emissions, the marginal abatement costs for the victim

Question

Quizplus · Accepted Answer

If a VPP principle is implemented, it means that the country emitting the greenhouse gases will have to compensate the victim country for damages incurred. This will increase the cost of emitting for the emitting country, forcing them to reduce their emissions or invest in more expensive abatement technologies, thus increasing the marginal abatement costs for the victim.

If a Bi-Lateral International Agreement Partially Moves to a Victim