How game theory will help to fight climate change

hello globe

good that we’re together i’m standing

for you here now pretty

pretty still it used to be different

when i was young

i was always walking and running around

making jokes and people were looking for

me my mother said where are you

so she put me on strings now and then

stay put

don’t make jokes all the time don’t talk

all the time

at school the same happened i was more

outside the classroom

because of insight because was making

jokes making noises

i had a lot of fun because i thought

school’s worth for that anyway many

rules at school and at home

many rules to break so do you know what

did i study

i studied law that’s kind of funny here

and god there are so many rules so many

rules to break but i found actually out

that rules can also help people

can empower people can give people

rights can give people space

in words so it’s good to know the

purpose about the rules

and how to make rules work for people

that’s why i try to study after my study

i worked on a legal aid office in the

netherlands

and giving advice to people who could

not afford a lawyer are giving rights to

people

empower them i did that six year and

then i worked for the environment

ministry

in the netherlands they were looking for

lawyers because they wanted to have a

good treaty

for climate change to agree globally a

law

to get the emissions to zero in the end

so it is a pretty tough rule right

so what we did in the kyoto protocol

that was a climate treaty we organized

it in a different way we gave more

flexibility to countries

instead of having one point year and a

target which they may fail

we organize to give them a budget you

have more space more flexibility to

actually meet the target

so that worked and that made me

interested in the game theory of

mechanism design

and game theory you try to study what

how people behave

if they play games how they play the

rules what incentives they need

and three researchers from the us they

got a nobel prize for a great idea it’s

called mechanism design

they said if you have a public goal for

example

environment health whatever they say you

need to have incentives for people that

you actually are engaged and willing and

happy to meet those targets that’s

mechanism design and a great example of

that

you can see that at least you could see

it in stockholm

that’s the place where they got the

nobel prizes there was a metro station

uh odin plan and the city council

thought let’s do more on health let’s

make our people more healthier

tackle obesity so what did they did is

they changed the

stairs into steps into a keyboard of a

piano

here you see it here and if you step the

stairs you hear music

and it actually worked people were

walking like hell every day

they got rid of the metro station now

because people were working all the time

all the day so no more basically no

that’s not really the reason but it

worked so if you give

the chance for people to have fun when

they walk the stairs instead of taking

the escalators

it helps so you see they’re a tough rule

health

and mechanism designed to help people to

meet the target

so how can we translate and use that for

climate change in europe

this example there are 10 000 companies

big polluters

they need to meet the co2 targets and of

course you can choose to give them all

the same

rules the same tough rules get to zero

there’s not much

flexibility and all companies are

different there are newer ones all the

ones

so they give this idea about a mechanism

design cap and trade

so you have this budget slowly

decreasing over time

you see the piano there so how does cap

and trade gives fun

and still meet the targets by allowing

companies

to they got part of those units of the

budget

and the cleaner companies they invest

earlier they recycle more they lose

renewables

they can sell their allowances and all

the companies that want to invest later

they need to purchase those allowances

so you see that this game of climate

the cleaner companies can win and the

dirtier they need to pay in the end the

climate wins

because the budget it just saw is

decreasing up to zero

and this is a good example of tough

rules and the mechanism design

incentives

to make this game really work another

example of uh

mechanism design is it helps to you all

i think you all like coffee and

chocolate right

did you drink coffee today i had some

great coffee here in wageningen good

nespresso and espresso great but

there’s a big problem with coffee and

chocolate

twenty percent of the global emissions

is because of deforestation

we lose a lot of trees every day because

of your coffee

so what you need to do is to look for

climate neutral coffee

how do we do this i know we in europe we

have our targets we need to get to zero

but the global emissions should also get

to zero so the mechanism design works as

follows

if you pay for this climate neutral

coffee

the governments of those countries there

are almost 50 first nations

they can invest the money in more

sustainable farming more productive

farming

so that they need to cut less trees

there’s some more shade trees over the

coffees

and it actually works so you can reduce

emissions but the reductions can be used

also by the europeans because we

pay for that coffee and reduce the

emissions there as well

so this is also a very good example of

mechanism design and the goal is clear

it’s pretty tough rule you know i didn’t

like rules in the beginning but if you

help people and governments and

companies to

to make them engaged and giving fun and

in rewards to meet the targets it can

actually work

so i say put the uh yeah put the strings

to the emissions but not to the people

because climate is a serious game

thank you