Forecasting the Paris 2015 UNFCCC Negotiations. The Exchange Model's Analysis of Developments and Potential Obstacles to Reaching an Agreement

Abstract

This research note presents analyses of the upcoming UNFCCC negotiations in Paris (November 30th to December 11th, 2015). We aim to contribute to an effective agreement in Paris by sharpening negotiators’ expectations concerning the likely developments and obstacles to reaching an agreement, as well as to demonstrate the application of the Exchange Model.
There are two main parts to the approach used here:
1.1. The fist part is a stakeholder analysis, which consists of a description of
the negotiations using the best available qualitative expert knowledge. We gained access to some of the most prominent and best informed negotiators and observers of the CoP21. Through a series of semi- structured interviews, we developed a dataset on the 13 most controversial issues that will be addressed in Paris.
1.2. The second part of the approach applies the Exchange Model to this dataset. The Exchange Model encapsulates the idea that stakeholders attempt to reach an agreement by combining issues with each other and making deals across issues. The Exchange Model, which is part of a family of game theoretic models of negotiations, has a strong 20-year track record in forecasting the outcomes of complex negotiations and in supporting strategic interventions to improve outcomes.

Full text

!
!
!
!
!
Forecasting!the!Paris!2015!UNFCCC!Negotiations!
!
!
The!Exchange!Model’s!Analysis!of!Developments!and!Potential!
Obstacles!to!Reaching!an!Agreement!
!
!
!
!
!
Frans!N.!Stokman!!!Robert!Thomson!
!
Professor!of!Sociology!! ! ! Professor!of!Politics!and!Public!Policy!
ICS,!University!of!Groningen! ! ! University!of!Strathclyde,!Glasgow!!
Scientific!Director! ! ! ! Email:!robert.thomson@strath.ac.uk!
Decide!(dutch)!bv!
Email:!f.n.stokman@rug.nl!
!
!
!
!
!
October!16,!2015!
! ! !
!
!
!
!!
!
!
!

!
!
2!
! !

!
!
3!
Executive!summary!
!
1. This!research!note!presents!analyses!of!the!upcoming!UNFCCC!negotiations!in!
Paris!(November!30th!to!December!11th,!2015).!We!aim!to!contribute!to!an!
effective!agreement!in!Paris!by!sharpening!negotiators’!expectations!concerning!
the!likely!developments!and!obstacles!to!reaching!an!agreement,!as!well!as!to!
demonstrate!the!application!of!the!Exchange!Model.!!
There!are!two!main!parts!to!the!approach!used!here:!
1.1. The!fist!part!is!a!stakeholder!analysis,!which!consists!of!a!description!of!
the!negotiations!using!the!best!available!qualitative!expert!knowledge.!
We!gained!access!to!some!of!the!most!prominent!and!best!informed!
negotiators!and!observers!of!the!CoP21.!Through!a!series!of!semi-
structured!interviews,!we!developed!a!dataset!on!the!13!most!
controversial!issues!that!will!be!addressed!in!Paris.!!
1.2. The!second!part!of!the!approach!applies!the!Exchange!Model!to!this!
dataset.!The!Exchange!Model!encapsulates!the!idea!that!stakeholders!
attempt!to!reach!an!agreement!by!combining!issues!with!each!other!
and!making!deals!across!issues.!The!Exchange!Model,!which!is!part!of!a!
family!of!game!theoretic!models!of!negotiations,!has!a!strong!20-year!
track!record!in!forecasting!the!outcomes!of!complex!negotiations!and!
in!supporting!strategic!interventions!to!improve!outcomes.!
!
2. Three!issues!present!serious!obstacles!to!reaching!an!agreement!in!Paris.!!
2.1. The!issue!of!Differentiation!concerns!the!question!of!what!should!be!
the!main!basis!for!effort!sharing!between!developed!and!developing!
countries.!The!positions!range!from!states!that!are!opposed!to!
incorporating!the!principle!of!Common!But!Differentiated!
Responsibilities!(CBDR)!to!states!that!favour!an!extensive!form!of!
differentiation.!Most!states!will!moderate!their!positions!and!support!a!
form!of!CBDR!in!the!light!of!national!circumstances.!However,!Russia!
will!remain!opposed!to!any!form!of!CBDR,!while!Brazil!will!insist!on!a!
stronger!commitment!to!CBDR.!!
2.2. The!issue!of!Mitigation!MRV!(Measuring,!Reporting!and!Verification)!
concerns!the!minimum!MRV!and!compliance!provisions!in!the!
agreement!on!mitigation.!!Most!states!will!moderate!their!positions!to!
support!a!form!of!International!Consultation!and!Analysis!(ICA)!
embedded!in!a!multilateral!process!even!with!some!aspects!of!
International!Assessment!and!Review!(IAR).!China!will!remain!opposed!
to!any!form!of!ICA!embedded!in!a!multilateral!process,!while!the!EU!will!
insist!on!retaining!the!Kyoto!compliance!regime.!!
2.3. The!issue!of!Finance!Who!Pays?!is!about!whether!developing!countries,!
and!if!so!which!ones,!should!be!obliged!or!invited!to!contribute!to!the!
climate!fund.!Most!states!will!be!willing!to!compromise,!but!the!
substance!of!the!compromise!they!will!be!willing!to!accept!still!needs!to!
be!formulated.!We!suggest!that!a!logical!compromise!involves!a!form!of!
performance-based!contributions.!The!Arab!states!will!remain!opposed!
to!expanding!the!group!of!contributors!beyond!developed!countries.!

!
!
4!
Meanwhile,!the!EU!will!continue!to!call!for!a!system!in!which!more!
developing!countries!(except!the!LDCs!and!SIDS)!are!obliged!to!
contribute.!!
!
3. A!greater!degree!of!convergence!is!expected!on!the!remaining!issues.!These!can!
be!divided!into!the!following!areas:!
3.1. Mitigation!Legal!Form!and!Ex!Ante!Assessment!of!Intended!Nationally!
Determined!Contributions!(INDCs).!There!will!be!a!significant!degree!of!
convergence!on!the!need!for!a!binding!agreement!with!an!obligation!
for!each!country!to!have!a!(non-binding)!country-specific!target!in!the!
form!of!an!INDC.!A!consensus!will!emerge!that!there!should!be!an!ex!
ante!assessment!(EEA)!of!the!aggregate!ambition,!but!not!technical!
EEAs!of!each!INDC.!
3.2. Adaptation.!A!consensus!will!emerge!on!the!need!for!non-binding!
country-specific!commitments!to!adaptation!targets.!A!broad!
consensus!will!also!emerge!on!strengthening!the!present!institutional!
framework!for!adaptation,!as!well!as!on!reserving!a!significant!
proportion!of!finance!for!adaptation.!There!will,!however,!be!little!
appetite!for!more!than!a!preambular!reference!to!Loss!and!Damage!in!
the!agreement.!
3.3. !Finance.!A!consensus!will!emerge!on!the!need!for!a!large!increase!in!
the!volume!of!finance,!somewhere!in!excess!of!$350bn!per!annum!of!
public!and!private!funds!by!2030.!
3.4. Ambition!level.!A!consensus!will!emerge!in!support!of!a!2050!goal!of!
70%!greenhouse!gas!reduction!relative!to!2010!levels.!For!the!2100!
goal,!there!will!be!agreement!on!zero!net!emissions!with!some!
reference!to!repairing!the!damage!with!negative!emissions.!Most!
stakeholders!will!agree!on!a!mechanism!to!ensure!that!future!
commitments!are!at!least!as!strong!as!those!made!in!Paris!(no!
backsliding!or!a!non-binding!progression!principle),!although!India!will!
remain!reluctant!to!accept!such!a!principle.!
!
4. These!forecasts!are!based!on!the!assumption!that!the!negotiators!are!willing!to!
link!all!of!the!main!controversial!issues!during!the!course!of!the!negotiations.!
The!negotiators!may,!however,!separate!the!negotiations!on!the!financial!issues!
from!the!other!issues.!If!they!do!so,!then!an!agreement!is!far!more!difficult!to!
achieve!both!within!the!subset!of!financial!issues!and!in!the!subset!of!non-
financial!issues.!Moreover,!the!agreement!–!if!reached!at!all!–!would!be!at!least!
as!financially!costly!for!developed!countries.!

!
!
5!
1.!Introduction1!
!
The!21st!session!of!the!Conference!of!the!Parties!to!the!United!Nations!Framework!
on!Climate!Change!(CoP21)!will!be!held!in!Paris!from!November!30th!to!December!
11th,!2015.!Our!hope!is!that!this!event!will!result!in!a!new!international!agreement!
on!climate!that!will!be!ambitious!enough!to!keep!global!warming!below!2°C,!and!the!
aim!of!our!study!is!to!support!negotiators!in!achieving!this!agreement.!The!research!
approach!we!use!is!based!on!applied!game!theoretic!modelling!that!simulates!and!
forecasts!negotiation!processes!and!outcomes.!The!approach!has!been!applied!
extensively!and!successfully!in!a!wide!range!of!highly!complex!negotiations,!including!
those!on!the!formation!on!international!treaties.!One!of!the!previous!applications!
was!the!CoP15!held!in!Copenhagen!in!2009,!in!which!the!model!accurately!predicted!
the!disappointing!outcome!of!that!conference!and!offered!what!could!have!been!a!
strategy!to!achieve!an!agreement.!
!
The!main!question!we!address!in!this!report!is!the!following:!What!are!the!likely!
shifts!in!the!stakeholders’!policy!stances!on!the!key!controversial!issues?!Answers!to!
this!question!identify!potential!obstacles!to!an!agreement!in!the!form!of!particular!
stakeholders!and!issues.!Answers!to!this!question!also!help!us!to!forecast!the!
substantive!outcomes!that!can!be!expected!from!the!conference.!This!knowledge!
enables!negotiators!to!focus!their!attention!on!the!aspects!of!the!negotiation!that!
are!expected!to!be!particularly!challenging.!!
!
There!are!two!main!parts!to!our!research!approach.!The!first!part!consists!of!a!
stakeholder!analysis!that!makes!use!of!the!best!available!qualitative!expertise!on!the!
negotiations.!With!tried-and-tested!semi-structured!interview!techniques,!we!
formulated!a!stylised!description!of!the!main!elements!of!the!negotiations.!We!
received!access!to!and!extensive!cooperation!from!practitioners!and!close!observers.!
These!included!a!series!of!lengthy!meetings!with!a!team!of!practitioners!from!the!
European!Commission’s!DG!Climate!Action,!including!one!of!the!EU’s!main!
negotiators,!and!input!from!policymakers!in!the!Dutch!Ministry!of!Infrastructure!and!
Environment,!and!extensive!input!from!two!experts!at!the!Oslo!Climate!Institute!
Cicero.!In!addition,!we!received!input!from!officials!in!the!UK!government,!a!close!
observer!of!this!and!many!previous!CoPs!from!the!Earth!Negotiation!Bulletin,!and!a!
representative!of!the!business!community,!The!specification!of!the!key!controversial!
issues!was!validated!with!an!online!survey!of!40!climate!change!experts!held!by!
Cicero.!The!stakeholder!analysis!consists!of!a!detailed!inventory!of!the!main!
stakeholders’!policy!stances!on!each!of!these!issues,!the!level!of!salience!each!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
1!This!report!is!part!of!a!larger!project!on!Paris!2015!with!Professor!Bruce!Bueno!de!Mesquita!(New!
York!University),!Professor!Detlef!Sprinz!(Potsdam!University)!and!the!Oslo!Climate!Institute!Cicero.!
The!Exchange!Model!applied!here!was!developed!in!close!cooperation!with!Reinier!Van!Oosten,!who!
also!developed!the!software,!financed!by!the!company!Decide!(now!part!of!the!dutch!group).!We!are!
grateful!for!the!extensive!cooperation!from!practitioners!and!close!observers!of!Paris!2015,!including!
experts!from!the!European!Commission’s!DG!Climate!Action,!the!Dutch!Ministry!of!Infrastructure!and!
Environment,!the!UK!government,!Earth!Negotiation!Bulletin,!the!Oslo!Climate!Institute!Cicero,!the!
international!business!community,!and!40!climate!change!experts!who!participated!in!Cicero’s!online!
survey.!We!thank!Lars!Padmos!for!research!assistance.!

!
!
6!
stakeholder!attaches!to!each!issue,!and!each!stakeholder’s!power!or!potential!
influence.!We!drew!mainly!on!input!from!the!experts!at!DG!Climate!Action!to!specify!
the!key!controversial!issues.!The!information!on!stakeholders’!policy!stances!draws!
mainly!on!documentary!sources!consulted!by!experts!at!Cicero.!The!information!on!
stakeholders’!issue!salience!and!power!are!based!mainly!on!estimates!provided!by!
practitioners,!partly!because!it!is!difficult!to!derive!valid!indicators!of!these!
characteristics!from!documentation.!!
!
The!second!part!of!the!research!approach!consists!of!the!Exchange!Model,!which!we!
apply!to!the!descriptive!information!from!the!stakeholder!analysis.!The!Exchange!
Model!encapsulates!the!intuitively!plausible!idea!that!negotiations!are!driven!by!a!
process!of!political!exchange,!whereby!stakeholders!make!concessions!on!some!
issues!in!return!for!concessions!on!other!issues.!The!model!formalises!the!conditions!
under!which!political!exchanges!take!place!and!provides!a!tool!for!analysing!complex!
negotiations!in!which!many!stakeholders!and!issues!are!involved.!The!Exchange!
Model,!in!various!stages!of!development,!has!been!the!subject!of!a!large!number!of!
peer-reviewed!publications!over!the!past!20!years!in!some!of!the!most!prestigious!
university!presses!and!journals!in!political!science!(e.g.!Bueno!de!Mesquita!and!
Stokman!1994;!Dijkstra!et!al.!2008;!Stokman!et!al.!2013;!Thomson!et!al.!2006).!The!
Exchange!Model!is!part!of!a!tradition!of!research!involving!the!formal!analysis!of!
complex!negotiations.!In!addition!its!academic!track!record,!the!model!has!
performed!well!in!a!wide!range!of!applied!research!projects,!in!which!it!has!been!
used!to!advise!clients!who!are!engaged!in!complex!negotiations.!These!have!
included!public!and!private!sector!negotiations!at!the!national!and!international!
levels.!!
!
2.!The!Stakeholder!Analysis!
!
The!stakeholders!consist!of!15!states!or!groups!of!states.!Non-governmental!actors!
including!environmental!and!industry!groups!are!also!relevant!to!the!global!
governance!of!climate!change.!They!raise!awareness!of!the!problem,!lobby!
governments!to!adopt!certain!policy!responses,!and!influence!the!positions!taken!by!
governments.!However,!the!consensus!among!practitioners!and!informed!observers!
is!that!the!CoPs!are!events!in!which!the!relevant!actors!are!states!and!groups!of!
states.!!
!
Some!of!the!15!stakeholders!are!groups!of!states.!Given!the!complexity!of!global!
negotiations,!many!small!and!medium-sized!states!coordinate!their!negotiating!
positions.!For!example,!the!European!Union’s!28!members!are!represented!by!the!
EU!as!a!collective!actor,!rather!than!28!separate!governments.!We!defined!the!
stakeholder!list!in!such!a!way!that!the!overlap!between!the!stakeholders!was!
minimised.!This!is!an!important!consideration!for!the!application!of!the!model,!since!
we!should!avoid!counting!a!state!more!than!once,!which!would!overestimate!its!
influence.!The!stakeholder!list!is!also!defined!in!such!a!way!that!we!are!able!to!
represent!the!main!policy!positions!taken!and!the!relative!priorities!of!the!main!
actors.!We!find,!for!instance,!that!the!negotiation!positions!of!the!USA,!Japan!and!
Russia!are!not!well!represented!by!the!Umbrella!Group!(a!loose!coalition!of!non-EU!

!
!
7!
developed!countries).!We!therefore!list!the!USA,!Japan!and!Russia!as!separate!
stakeholders,!but!include!the!Umbrella!Group!as!a!collective!actor!that!represents!
the!views!of!the!remaining!members!reasonably!well!(Australia,!Canada,!New!
Zealand,!Kazakhstan,!Norway!and!Ukraine).!!After!some!deliberation,!we!decided!not!
to!include!France!as!a!separate!stakeholder!despite!the!fact!that!it!chairs!the!CoP21!
since!this!would!overestimate!the!European!influence!on!the!negotiations.!We!also!
excluded!the!G77!as!a!separate!stakeholder,!because!the!influence!this!loose!
coalition’s!members!are!represented!by!other!stakeholders!included!in!the!analysis.!
!
Table!1!lists!the!15!stakeholders!together!with!estimates!of!their!relative!power!and!
the!importance!each!attaches!to!reaching!an!agreement!in!Paris.!Figure!1!gives!the!
same!information!graphically.!Relative!power!is!defined!as!the!potential!a!
stakeholder!has!relative!to!others!to!influence!other!actors!and!the!decision!
outcome.!We!conceive!of!power!as!based!on!a!complex!array!of!hard!and!soft!
resources,!including!but!not!limited!to!the!formal!rules!of!the!negotiation!process,!
diplomatic!skills,!technical!expertise,!economic!power,!and!legitimacy.!The!estimates!
of!relative!power!are!based!on!the!qualitative!judgements!of!the!experts!that!
incorporate!their!knowledge!of!a!range!of!hard!and!soft!power!resources.!!
!
!
Table!1.!The!Stakeholders,!their!Relative!Power!and!the!Importance!they!Attach!to!
Reaching!an!Agreement!
Stakeholder!
Abbreviation!
Relative!Power!
Importance!
Attached!to!
Reaching!
Agreement!
China!
China!
100!
70!
USA!
USA!
100!
50!
European!Union!
EU!
75!
90!
Brazil!
Brazil!
70!
70!
India!
India!
60!
80!
Japan!
Japan!
60!
50!
Russia!
Russia!
60!
10!
Alliance!of!Small!Island!States!
AOSIS!
50!
100!
Least!Developed!Countries!
LDCs!
50!
95!
Arab!states!
Arab!states!
40!
5!
Umbrella!Group!minus!the!USA,!Russia!and!
Japan!
!
Umbrella!minus!
40!
40!
Independent!Alliance!of!Latin!America!and!
the!Caribbean!
!
AILAC!
35!
80!
The!Environmental!Integrity!Group:!
Liechtenstein,!Monaco,!the!Republic!of!Korea!
and!Switzerland!
!
!
EIG!
35!
80!
African!states!
African!group!
25!
80!
Bolivarian!Alliance!for!the!Peoples!of!Our!
America!
!
ALBA!
5!
5!
!
!
The!estimates!of!relative!power!indicate!that!China!and!the!USA!are!equally!
powerful!and!hold!more!power!than!any!of!the!other!actors.!The!EU!is!the!next!most!
powerful!stakeholder,!followed!by!Brazil,!India,!Japan!and!Russia.!The!relations!

!
!
8!
between!the!numbers,!rather!than!their!absolute!values,!are!relevant.!So!a!
stakeholder!with!a!relative!power!score!of!100!is!twice!as!powerful!as!another!
stakeholder!with!50!(the!numbers!do!not!imply!that!the!stakeholder!with!100!has!all!
of!the!power!or!even!a!veto).!Given!that!an!agreement!will!require!unanimous!
agreement,!we!assume!that!all!of!the!main!actors!must!converge!at!least!to!some!
extent!on!whatever!compromise!outcome!emerges.!
!
The!estimates!of!the!importance!attached!to!reaching!agreement!refer!to!the!effort!
each!stakeholder!is!expected!to!make!to!achieve!a!unanimously!accepted!
agreement.!Estimates!closer!to!0!indicate!that!the!stakeholder!would!more!readily!
accept!a!situation!in!which!the!negotiations!fail.!This!variable!is!not!part!of!the!
Exchange!Model,!but!it!does!highlight!the!stakeholders!that!deserve!particular!
attention.!
!
!
!
Figure!1.!Relative!Power!and!Importance!of!Agreement!
!
!
The!stakeholder!analysis!also!identifies!the!main!controversial!issues!that!must!be!
resolved!if!an!agreement!is!to!be!reached.!These!consist!of!the!following!13!points!of!
contention.!!
!
- Differentiation.!This!is!a!cross-cutting!issue!that!concerns!the!question!of!the!
main!basis!for!effort-sharing!between!developed!and!developing!countries!in!
the!new!agreement.!
!
Under!the!heading!of!Mitigation!there!are!three!main!issues:!

!
!
9!
- Mitigation!MRV!(Measuring,!Reporting!and!Verification)!concerns!the!
minimum!MRV!and!compliance!provisions!in!the!agreement!on!mitigation.!
- Mitigation!Legal!Form!concerns!the!extent!to!which!the!agreement!and!its!
components!relating!to!mitigation!targets!should!be!(internationally)!legally!
binding.!
- Ex!Ante!Assessments!(EEAs)!concern!the!provisions!for!assessment!and!
review!of!the!nationally!determined!contributions.!
!
Under!the!heading!of!Adaptation,!there!are!four!main!issues:!
- Adaptation!Legal!Form!centres!on!the!question!of!the!extent!to!which!
commitments!to!adaptation!targets!should!be!country-specific!and!legally!
binding.!
- Adaptation!Institutions!is!about!the!extent!to!which!the!institutional!
framework!for!adaptation!should!be!strengthened.!
- Adaptation!Reserved!Financing!asks!whether!funds!should!be!reserved!for!
adaptation.!
- Loss!and!Damage!(L&D)!is!about!the!degree!to!which!L&D!from!the!effects!of!
climate!change!should!be!included!in!an!agreement.!
!
Under!the!heading!of!Finance,!there!are!two!main!issues:!
- Finance!Who!Pays?,!which!concerns!the!question!of!whether!developing!
countries,!and!if!so!which!ones,!should!be!obliged!or!invited!to!contribute!to!
the!climate!fund.!
- Finance!Amount!refers!to!the!total!amount!of!funds!that!will!be!mobilized!by!
2030.!
!
Under!the!heading!Ambition,!we!include!three!issues:!
- Ambition!2050,!which!concerns!the!mitigation!goal!set!for!2050.!
- Ambition!2100!concerns!the!mitigation!goal!for!2100.!
- Ambition!Progression!concerns!the!mechanism!for!strengthening!
commitments!over!time.!
!
For!each!one!of!these!13!issues,!the!analysis!identifies!the!position!of!each!of!the!15!
stakeholders!and!the!level!of!salience!each!stakeholder!attaches!to!each!issue.!The!
positioning!of!each!stakeholder!involves!defining!the!main!policy!alternatives!on!
each!issue!in!the!form!of!policy!scales,!each!of!which!ranges!from!0-100.!Each!
stakeholder!is!then!placed!on!each!policy!scale!to!represent!its!policy!stance.!With!a!
few!exceptions,!all!of!the!stakeholders!have!positions!on!all!of!the!issues.!The!
exceptions!are!that!some!of!the!developing!countries!have!no!specific!positions!on!
the!issues!of!Ambition!2050!and!Ambition!2100.!!
!
The!level!of!salience!each!stakeholder!attaches!to!each!issue!refers!to!the!effort!the!
stakeholder!invests!in!influencing!other!stakeholders!on!that!issue!and!its!inflexibility!
on!the!issue.!Issue!salience!is!also!estimated!on!0-100!scales.!Higher!values!of!issue!
salience!indicate!more!effort!and!less!flexibility,!while!lower!values!indicate!less!
effort!and!more!flexibility.!Issue!salience!allows!us!to!compare!the!relative!
importance!of!different!issues!for!the!same!stakeholder,!as!well!as!the!relative!

!
!
10!
importance!of!an!issue!to!different!stakeholders.!These!relative!values!are!
particularly!relevant!for!the!purposes!of!the!Exchange!Model.!!
3.!The!Exchange!Model!Applied!
!
This!section!presents!the!main!results!from!the!Exchange!Model.!The!input!data!
consists!of!the!numerical!information!on!the!stakeholders’!positions!on!each!of!the!
13!issues,!their!relative!issue!salience!and!their!relative!power.!The!analysis!assumes!
that!all!13!issues!can!be!linked!with!each!other!if!the!stakeholders!concerned!have!
an!incentive!to!do!so.!!
!
The!Exchange!Model!identifies!all!of!the!potential!exchanges!across!each!pair!of!
issues!in!which!Stakeholder!A!has!an!incentive!to!enter!into!an!exchange!with!
Stakeholder!B.!For!an!exchange!opportunity!to!exist,!certain!conditions!must!be!met.!
First,!the!stakeholders!must!disagree!to!some!extent!on!both!issues!(technically,!they!
must!be!on!opposite!sides!of!the!expected!outcome).!Second,!the!stakeholders!must!
differ!in!terms!of!the!relative!salience!they!attach!to!the!issues!involved.!The!
technicalities!of!these!conditions!are!explained!in!detail!in!the!relevant!academic!
publications.!For!the!present!purposes,!it!is!noteworthy!that!the!model!identifies!all!
potential!exchanges!and!the!implications!of!these!exchanges!for!developments!in!
stakeholders’!positions!and!for!the!expected!outcome!of!the!negotiations!on!each!
issue.!In!addition,!as!will!become!clear!later!in!this!section,!the!model!enables!us!to!
keep!track!of!the!consequences!of!exchanges!for!stakeholders!that!are!not!directly!
involved!in!exchanges:!so-called!positive!and!negative!externalities!for!bystanders.!
!
The!Exchange!Model!simulates!a!series!of!negotiation!rounds.!In!each!round!the!
potential!exchanges!are!identified.!Exchanges!with!the!highest!utility!gains!for!the!
stakeholders!directly!involved!are!implemented!first.!The!implementation!of!each!
exchange!results!in!changes!in!the!positions!of!the!stakeholders!involved.!
Stakeholder!A!makes!a!concession!on!its!“supply”!issue!by!shifting!its!position!
gradually!towards!the!position!of!Stakeholder!B,!in!return!for!receiving!a!concession!
from!Stakeholder!B!on!its!(A’s)!“demand”!issue.!These!shifts!in!positions!are!assumed!
to!take!place!gradually,!whereby!the!adjusted!positions!from!one!round!are!fed!into!
the!next!round.!This!ensures!that!the!results!are!not!unduly!driven!by!one!or!two!big!
exchanges.!We!apply!ten!rounds!of!the!Exchange!Model.!While!ten!rounds!is!
somewhat!arbitrary,!experience!in!applying!the!model!shows!that!there!are!little!to!
no!shifts!in!positions!after!the!ten!rounds.!By!the!tenth!round!the!stakeholders’!
positions!have!either!converged!or!not.!
!
With!15!stakeholders!and!13!negotiation!issues,!there!are!a!large!number!of!
exchange!opportunities:!too!many!to!keep!track!of!without!the!aid!of!a!model!
implemented!in!a!computer!programme.!The!model!identifies!129!exchange!
opportunities!in!round!1!and!a!total!of!1,330!exchange!opportunities!across!the!ten!
simulated!rounds!of!negotiations.!To!illustrate,!in!round!1,!there!are!exchange!
opportunities!involving:!

!
!
11!
- The!USA!and!China!on!Finance!Amount!and!Ex!Ante!Assessments.!The!USA!
offers!a!concession!to!China!on!EEAs!in!return!for!a!concession!from!China!on!
Finance!Amount.!
- The!USA!and!China!on!Finance!Who!Pays?!and!Differentiation.!The!USA!offers!
a!concession!to!China!on!Finance!Who!Pays?!in!return!for!a!concession!from!
China!on!Differentiation.!
- The!EU!and!India!on!Mitigation!MRV!and!EEAs.!The!EU!offers!a!concession!to!
India!on!EEAs!in!return!for!a!concession!from!India!on!Mitigation!MRV.!
!
3.1.!Obstacles!to!Reaching!an!Agreement!in!Paris!
!
Three!of!the!issues!present!particular!difficulties!for!the!negotiators!in!Paris.!These!
are!issues!on!which!two!or!more!very!significant!stakeholders!do!not!converge!
towards!the!common!position!that!others!are!likely!to!support.!!
!
Differentiation!
!
This!issue!concerns!the!question!of!what!will!be!the!main!basis!for!effort!sharing!in!
the!new!agreement.!In!particular,!to!what!extent!will!differentiation!be!made!
between!developed!and!developing!countries!with!respect!to!the!nature!of!their!
commitments?!The!0-100!policy!scale!we!constructed!with!the!help!of!the!experts!to!
represent!this!controversial!issue!consists!of!the!following!positions:!
!
0:!! No!explicit!differentiation!(self-differentiation)!
25:!! National!circumstances!
50:!!CBDR-Respective!Capabilities!in!light!of!national!circumstances!
75:!!CBDR-Respective!Capabilities!(with!no!direct!reference!to!the!Convention’s!
Annexes!or!Articles!referring!to!those!Annexes)!
100:!! Annexes!I!and!II!of!the!Convention!
!
Each!of!the!abovementioned!actors!was!placed!on!this!policy!scale!to!reflect!its!
position!on!the!issue!as!depicted!in!the!figure!below.!Note!that!not!all!actors!were!
placed!on!one!of!the!policy!scale!points!that!were!defined.!Russia,!for!instance,!was!
placed!on!position!15.!This!represents!the!general!approach!taken!by!the!
stakeholder!on!this!issue!as!well!as!the!inherent!ambiguity!in!some!of!the!positions!
in!the!preparations!for!the!negotiations.!The!colours!refer!to!the!salience!scores:!80-
100!are!red;!50!to!79!are!orange;!and!below!50!are!green.!Issues!on!which!both!ends!
of!the!scale!are!red!are!therefore!highly!controversial.!
!
!

!
!
12!
!
Figure!2.!Stakeholders’!Positions!on!the!Issue!of!Differentiation!
Note:!Salience!scores!in!parentheses!
!
The!Exchange!Model!forecasts!shifts!in!the!stakeholders’!positions!over!ten!
negotiation!rounds,!as!depicted!in!Figure!3.!There!will!be!considerable!convergence!
towards!positions!40-50!of!the!policy!scale,!which!means!that!most!stakeholders!will!
accept!the!principle!of!CBDR!in!the!light!of!national!circumstances.!Two!
stakeholders,!however,!will!not!shift!their!initial!positions!on!this!issue.!Russia!will!
remain!opposed!to!the!inclusion!of!any!form!of!CBDR!in!the!agreement!(position!15).!
At!the!other!side!of!the!issue,!Brazil!will!continue!to!argue!that!a!stronger!form!of!
CBDR!should!be!included!in!the!agreement!(position!80).!!
!

!
!
13!
!
!
Figure!3.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!
Positions!on!the!Issue!of!Differentiation!
!
Mitigation-MRV!
!
The!issue!of!Mitigation-MRV!(Measuring,!Reporting!and!Verification)!concerns!the!
minimum!MRV!and!compliance!provisions!in!the!agreement!on!mitigation.!!The!0-
100!policy!scale!constructed!to!represent!the!different!positions!taken!consists!of!
the!following!values:!
!
0:!International!Consultation!and!Analysis!(ICA)!
45:!ICA!plus!multilateral!consultative!process!
65:!International!Assessment!and!Review!(IAR)!
75:!IAR!plus!committee!on!implementation!and/or!compliance!
100:!Kyoto!compliance!regime!
!
The!stakeholders!were!placed!on!this!policy!scale!to!represent!the!positions!they!
currently!favour,!as!depicted!in!Figure!4.!
!
Brazil!
Russia!
Rounds'

!
!
14!
!
Figure!4.!Stakeholders’!Positions!on!the!Issue!of!Mitigation!MRV!
Note:!Salience!scores!in!parentheses!
!
!
The!Exchange!Model!forecasts!the!shifts!in!the!stakeholders’!positions!depicted!in!
Figure!5.!Most!of!the!stakeholders!will!moderate!their!positions!to!somewhere!in!the!
range!of!positions!50-65!on!the!policy!scale,!which!represents!a!willingness!to!accept!
ICA!embedded!in!a!multilateral!consultation!process,!and!even!a!willingness!to!
incorporate!some!elements!of!IAR.!
!
China!and!the!EU,!however,!will!make!little!or!no!moves!from!their!current!positions.!
In!the!case!of!China,!the!model!predicts!a!softening!of!the!opposition!to!a!
multilateral!consultative!process,!but!continuing!opposition!to!the!emerging!
consensus!among!the!other!actors.!Meanwhile,!the!EU!will!continue!to!call!for!a!
much!stronger!compliance!regime!akin!to!the!Kyoto!arrangements.!
!
!

!
!
15!
!
!
Figure!5.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!
Positions!on!the!Issue!of!Mitigation!MRV!
!
!
Finance-Who!Pays?!
!
The!issue!of!Finance-Who!Pays?!concerns!the!question!of!whether!developing!
countries,!and!if!so!which!ones,!should!be!obliged!or!invited!to!contribute!to!the!
climate!fund.!The!0-100!policy!scale!for!this!issue!is!defined!as!follows:!
!
0:!Developed!countries!only!required!to!contribute!
20:!Developed!countries!required!to!contribute,!and!other!countries!invited!to!
contribute!voluntarily!
60:!Developed!countries!and!certain!other!countries!required!to!contribute!(e.g.!
“countries!in!a!position!to!do!so”!or!emerging!economies).!
80:!All!countries!minus!LDCs!and!SIDS!required!to!contribute!
100:!All!countries!required!to!contribute.!
!
Figure!6!depicts!the!stakeholders’!positions!and!relative!salience!scores!on!this!issue.!
The!experts!indicated!somewhat!less!certainty!regarding!the!positions!on!the!
financial!issues!compared!to!the!other!issues.!The!preparatory!talks!held!so!far!were!
said!to!have!focused!less!on!the!financial!issues!than!on!the!other!issues.!We!also!
note!that!there!is!more!clustering!in!the!stakeholders’!positions!on!this!issue!than!on!
the!previous!issues,!which!may!be!due!to!this!uncertainty.!While!the!option!of!
requiring!all!countries!to!contribute!(position!100)!is!theoretically!possible!and!the!
logical!endpoint!of!this!scale,!none!of!the!stakeholders!support!this!position.!
!
!
China!
EU!
Rounds'

!
!
16!
!
Figure!6.!Stakeholders’!Positions!on!the!Issue!of!Finance!Who!Pays?!
Note:!Salience!scores!in!parentheses!
!
!
The!Exchange!Model’s!forecasts!of!the!development!in!stakeholders’!positions!on!
this!issue!indicate!that!while!a!significant!amount!of!movement!will!take!place!in!the!
positions!on!this!issue,!it!will!remain!a!potentially!serious!obstacle!to!reaching!an!
agreement!in!Paris!(Figure!7).!!
!
The!forecasts!indicate!that!most!stakeholders!will!be!willing!to!agree,!but!the!
substance!of!the!compromise!remains!undefined.!The!model!predicts!that!most!
stakeholders!will!move!towards!a!compromise!position!in!the!range!of!30-50!on!this!
policy!scale.!This!region!lies!between!position!20,!which!stands!for!“developed!
countries!required!to!contribute,!and!other!countries!invited!to!contribute!
voluntarily”,!and!position!60,!which!stands!for!“developed!countries!and!certain!
other!countries!required!to!contribute!(e.g.!‘countries!in!a!position!to!do!so’!or!
emerging!economies)”.!Formulating!the!substance!of!this!compromise!will!require!
considerable!attention.!We!suggest!that!a!logical!basis!for!defining!this!compromise!
could!be!a!performance-based!rule!for!gauging!the!level!of!contributions!requested!
or!required,!whereby!failure!to!meet!country!targets!would!mean!higher!
contributions!to!the!fund.!!
!
Notwithstanding!the!possibility!of!formulating!a!broadly!supported!compromise!on!
this!issue,!some!discussion!will!remain!on!the!principle!of!obliging!developing!
countries!to!contribute.!The!Arab!states,!the!EU!and!the!Umbrella!Group!(minus!
Japan,!Russia!and!the!USA)!will!be!reluctant!to!support!the!compromise.!On!one!
side,!the!Arab!states!will!continue!to!argue!against!the!expansion!of!the!group!of!
contributors!beyond!the!developed!countries.!The!EU!and!the!Umbrella!Group!

!
!
17!
(minus)!by!contrast!will!continue!to!call!for!a!system!in!which!more!developing!
countries,!with!the!exception!of!LDCs!and!SIDS,!are!obliged!to!contribute.!
!
!
Figure!7.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!
Positions!on!the!Issue!of!Finance!Who!Pays?!
!
!
Negative!Externalities!Experienced!by!Each!Stakeholder!
!
When!stakeholders!enter!into!political!exchanges!during!negotiations,!they!do!so!out!
of!self-interest.!Stakeholder!A!makes!a!concession!toward!Stakeholder!B!on!an!issue!
to!which!it!(Stakeholder!A)!attaches!relatively!low!salience,!in!return!for!a!concession!
from!Stakeholder!B!on!an!issue!to!which!it!(Stakeholder!A)!attaches!relatively!high!
salience.!These!shifts!in!positions!move!the!expected!decision!outcome!further!from!
Stakeholder!A’s!position!on!the!first!issue!and!move!the!expected!decision!outcome!
closer!to!Stakeholder!A’s!position!on!the!second!issue.!!
!
Such!shifts!in!stakeholders’!positions!and!the!expected!outcomes!also!have!
implications!for!stakeholders!that!are!not!directly!involved:!so-called!externalities!for!
bystanders.!Some!exchanges!have!positive!externalities!for!a!bystander,!whereby!the!
bystander!is!better!off!than!before!without!having!to!make!any!concessions!itself.!
Negative!externalities!are!also!possible,!whereby!the!bystander!ends!up!being!worse!
off!in!terms!of!the!expected!outcomes!of!the!negotiations!as!a!consequence!of!
exchanges!in!which!it!was!not!involved.!
!
Stakeholders!that!experience!negative!externalities!that!greatly!outweigh!the!
positive!externalities!and!gains!from!exchanges!in!which!they!themselves!are!
involved!deserve!careful!attention.!If!these!are!powerful!stakeholders!that!are!also!
Umbrella!minus!
EU!
Arab!states!
Rounds'

!
!
18!
isolated!on!one!or!more!key!issues,!this!could!present!a!significant!obstacle!to!
reaching!a!unanimous!agreement.!
!
Figure!8!presents!the!net!gains!or!losses!for!each!of!the!stakeholders!as!a!
consequence!of!both!the!exchanges!in!which!each!is!involved!(which!are!by!
definition!positive)!as!well!as!from!the!positive!or!negative!externalities!from!the!
exchanges!in!which!each!is!a!bystander.!The!key!finding!is!that!these!are!broadly!in!
balance!for!most!stakeholders,!but!that!the!EIG,!China!and!Brazil!experience!
substantial!negative!net!externalities.!The!powerful!position!of!China!and!Brazil!and!
the!fact!that!they!are!both!relatively!isolated!on!one!of!the!key!issues!mean!that!
these!two!stakeholders!deserve!particular!attention.!
!
!
Figure!8.!The!Exchange!Model’s!Forecasts!of!the!Net!Effects!of!Exchanges!for!Each!
Stakeholder!
!
3.2.!Broad!Convergence!on!the!Remaining!Issues!
!
In!contrast!to!the!three!issues!mentioned!above,!the!Exchange!Model!forecasts!the!
development!of!broad!consensus!on!the!ten!remaining!issues.!For!comparison!with!
the!issues!mentioned!above,!we!discuss!the!issue!of!Mitigation!Legal!Form!in!some!
detail,!but!suffice!with!shorter!summaries!of!the!forecasts!for!the!remaining!nine!
issues.!The!graphs!for!these!policy!scales!and!position!shifts!are!included!in!the!
appendix.!
!
!
!
!
! !

!
!
19!
Mitigation!Legal!Form!
!
The!issue!of!Mitigation!Legal!Form!concerns!the!question!of!the!extent!to!which!the!
agreement!and!its!components!relating!to!mitigation!targets!should!be!
(internationally)!legally!binding.!The!alternative!positions!are!summarized!on!the!
following!0-100!policy!scale:!
!
0:!No!binding!agreement!or!binding!country-specific!targets!
30:!Binding!agreement!without!country-specific!targets.!!
50:!Binding!agreement!plus!obligation!to!have!a!(nonbinding)!country-specific!target!
(INDC)!
70:!The!above!plus!obligation!on!measuring,!reporting!and!verification.!
100:!Binding!agreement!plus!binding,!country-specific!targets.!!
!
The!positions!of!the!stakeholders!are!depicted!in!the!following!figure.!!
!
!
!
Figure!9.!Stakeholders’!Positions!on!the!Issue!of!Mitigation!Legal!Form!
Note:!Salience!scores!in!parentheses!
!
!
The!Exchange!Model’s!forecasts!show!the!emergence!of!consensus!on!this!issue.!
Most!stakeholders!converge!to!or!close!to!position!50,!which!represents!a!binding!
agreement!with!the!obligation!to!have!a!(nonbinding)!country!specific!target!in!the!
form!of!an!INDC.!The!USA!remains!on!its!initial!position!of!40,!which!is!not!a!position!
that!has!a!distinct!meaning,!but!rather!indicates!some!degree!of!indifference!
between!the!inclusion!or!exclusion!of!the!obligation!to!have!a!nonbinding!country!
specific!target.!Given!the!convergence!of!positions,!the!Exchange!Model’s!forecast!of!
the!outcome!is!closest!to!position!50!on!the!policy!scale.!

!
!
20!
!
!
!
!
Figure!10.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!
Positions!on!the!Issue!of!Mitigation!Legal!Form!
!
Ex!Ante!Assessments!
The!issue!of!Ex!Ante!Assessments!(EEAs)!concerns!the!provisions!to!be!included!for!
assessment!and!review!of!the!nationally!determined!contributions.!The!main!
alternatives!on!the!0-100!policy!scale!are:!
!
0:!Option!1:!No!EAA&
20:!Option!2:!EAA!of!aggregate!ambition&
60:!Option!3:!EAA!of!aggregate!ambition!and!technical!EAA!of!individual!INDCs!
(transparency,!clarity,!comparability,!etc.)!&
90:!Option!4:!Option!3!plus!a!political!assessment!of!individual!INDCs!(ambition!and!
equity/fairness)!
100:!Option!5:!Option!4!and!a!formal!mechanism!for!involving!inputs!from!civil!
society!
!
The!Exchange!Model!predicts!a!convergence!of!stakeholders!towards!position!20!on!
the!scale.!The!outcome!will!therefore!be!Option!2!above,!an!EEA!of!aggregate!
ambition,!but!not!technical!EEAs!of!individual!INDCs.!
!
!
!
!
!
!
!

!
!
21!
Adaptation!Legal!Form!
This!issue!focuses!on!the!question!of!the!extent!to!which!countries’!new!
commitments!to!adaptation!targets!should!be!country-specific!and!legally!binding.!
The!alternatives!on!the!0-100!policy!scale!are:!
!
0:!! No!new!commitments!to!adaptation!
40:!! Collective,!non-binding!provisions.!E.g.!“all!parties!are!encouraged!to!
integrate!adaptation!into!their!national!plans”!
80:!!Non-binding!country-specific!commitments!
100:!! Legally!binding!country-specific!commitments!
!
The!Exchange!Model!forecasts!a!consensus!on!the!need!for!non-binding!country-
specific!commitments!(position!80).!
!
!
Adaptation!Institutions!
To!what!extent!should!the!institutional!framework!for!adaptation!be!strengthened?!
Here,!the!positions!on!the!0-100!policy!scale!are:!
!
0:!! No!strengthening!
60:!! Strengthen!present!institutions!(stronger!mandate,!funding!and!knowledge!
platform)!
80:!! Establish!new!institutions!stronger!than!present!ones.!
100:!! Establish!subsidiary!body!on!adaptation!
!
The!Exchange!Model!forecasts!the!emergence!of!a!broad!consensus!that!accepts!the!
need!to!strengthen!present!institutions,!even!to!the!extent!that!the!present!
institutions!take!on!new!forms.!Only!the!Arab!states!remain!to!some!extent!sceptical!
of!the!need!to!strengthen!the!institutional!framework!for!adaptation.!
!
!
Adaptation!Reserved!Financing!
To!what!extent!should!funds!be!reserved!for!adaptation?!
!
0:!! No!earmarking!for!adaptation!
50:!! Approximately!50%!earmarked!for!adaptation!
100:!! Dedicated!levy!for!adaptation!
!
The!Exchange!Model!forecasts!that!most!stakeholders!will!converge!to!a!position!
close!to!point!60!on!the!scale,!indicating!that!at!least!50!percent!of!the!funds!should!
be!earmarked!for!adaptation.!The!AILAC!group!will!continue!to!call!for!more!funds!
for!adaptation!and!a!dedicated!levy!or!similar!means!of!guaranteeing!the!reservation!
of!funds.!
!
! !

!
!
22!
Loss!and!Damage!
To!which!degree!will!loss!&!damage!(L&D)!be!included!in!an!agreement?!
!
0:!! No!mention/omission!of!L&D!
10:!! Preambular!reference!only!
20:!! Reference!to!Warsaw!International!Mechanism!(WIM)!(under!adaptation)!
30:!! Separate!chapter!on!L&D!with!little!substance!
40:!! Separate!chapter!on!L&D!and!new!institutional!arrangements!with!little!
substance!
50:!! Separate!chapter!on!L&D!and!new!institutional!arrangements!with!new!non-
financial!elements!(such!as!coordination!and!capacity-building)!
70:!! Separate!chapter!on!L&D!and!new!mechanism!with!new!non-financial!and!
financial!elements!(such!as!insurance)!but!no!compensation!regime!
100:!! Separate!chapter!on!L&D!and!new!non-financial!and!financial!elements,!
including!a!compensation!regime!
!
The!Exchange!Model!forecasts!position!shifts!towards!the!range!of!positions!from!
10-20!on!the!policy!scale.!The!USA!remains!opposed!to!any!reference!to!loss!and!
damage!in!the!agreement.!We!therefore!expect!little!more!than!a!preambular!
reference!to!loss!and!damage.!!
!
!
Finance!Amount!
What!amount!of!funds!should!be!be!mobilized!(private!and!public)!by!2030!(p.a.)?!
!
0:!! no!new!target!(i.e.!$100b!p.a.)!
20:!! Unspecified!increase!above!$100b!p.a.!
40:!! $!200b!p.a.!
60:!! $!300b!p.a.!
80:!! $!400b!p.a.!
100:!! ≥$500!b!(in!excess!of!1%!of!present!OECD!GDP!p.a.)!
!
On!this!issue!the!Exchange!Model!forecasts!the!development!of!a!broad!consensus!
close!to!point!75!on!the!policy!scale,!corresponding!to!an!amount!of!$375bn!per!
annum.!A!few!stakeholders!–!notably!ALBA,!the!African!group!and!the!LDCs!–!will!
continue!to!press!for!more!funds.!
!
!
Ambition!2050!
What!mitigation!goal!should!be!set!for!2050?!
!
0:!! No!2050!goal!
20:!! Qualitative!goal!
30:!! Qualitative!goal!with!a!roadmap!
50:!! Goal!of!40%!GHG!reduction!relative!to!2010!
70:!! Goal!of!70%!GHG!reduction!relative!to!2010!
100:!! Goal!of!zero!net!emissions!

!
!
23!
!
The!Exchange!Model!forecasts!the!development!of!a!broad!consensus!close!to!point!
70!on!the!scale,!corresponding!to!a!goal!of!70!percent!of!GHG!reduction!relative!to!
2010.!
!
!
Ambition!2100!
What!mitigation!goal!should!be!set!for!2100?!
!
0:!! No!2100!goal!
20:!! Qualitative!goal!
30:!! Qualitative!goal!with!a!roadmap!
80:!! Goal!of!zero!net!emissions!
100:!! Goal!of!negative!net!emissions!!
!
The!Exchange!Model!forecasts!that!a!broad!consensus!will!emerge!around!point!90!
on!the!policy!scale,!which!includes!a!goal!of!zero!net!emissions!by!2100,!and!some!
commitment!to!move!beyond!that.!
!
!
Ambition!Progression!
What!should!be!the!mechanism!for!strengthening!commitments!over!time?!
!
0:!! No!ambition!mechanism!
30:!! No!backsliding!principle!
40:!!A!non-binding!progression!principle!
65:!!A!binding!progression!principle!
100:!! A!binding!commitment!to!strengthen!targets!in!line!with!the!2!degrees!goal!
!
The!Exchange!Model!forecasts!that!most!stakeholders!will!converge!to!positions!
close!to!point!35!on!the!policy!scale,!representing!a!commitment!not!to!reduce!the!
level!of!ambition!(no!backsliding)!with!some!in!favour!of!a!non-binding!progression!
principle.!India,!however,!will!remain!reluctant!to!accept!such!a!principle.!
!
Table!2!summarizes!the!Exchange!Model’s!forecasts!of!the!shifts!in!stakeholders’!
positions!and!of!the!associated!negotiation!outcomes.!
!
!
! !

!
!
24!
Table!2.!Summary!of!the!Exchange!Model’s!Forecasts!!
Issue!
Predicted!
outcome!on!
the!policy!
scale!!
Description!of!outcome!
Convergence!in!
positions?!
Differentiation!
43!if!
convergence!
achieved!
CBDR!in!the!light!of!national!
circumstance!
No.!Brazil!and!Russia!
remain!outliers!
Mitigation&
!
!
!
MRV!
57!if!
convergence!
achieved!
ICA!in!a!multilateral!process!
with!aspects!of!IAR!
No.!EU!and!China!
remain!outliers!
Mitigation!-
Legal!Form!
51!
Binding!agreement!plus!
obligation!to!have!
(nonbinding)!country-specific!
targets!(INDCs)!
Yes!
EEA!
21!
EEA!of!aggregate!ambition!
Yes!
Adaptation&
!
!
!
Adaptation-!
Legal!Form!
79!
Non-binding!country-specific!
commitments!
Yes!
Institutions!
68!
Strengthen!existing!
institutions!with!new!powers!
Yes,!although!the!
Arab!states!remain!
reluctant!
Reserved!
Financing!
62!
50%!or!more!reserved!for!
adaptation!
Yes!
Loss!and!
Damage!
14!
Preambular!reference!only!
Yes!
Finance&
!
!
!
Who!Pays?!
44!if!
convergence!
achieved!
A!compromise!would!need!to!
be!defined!that!requires!some!
degree!of!contributions!from!
developing!countries.!We!
suggest!a!performance-based!
system!could!be!a!logical!
compromise.!
No.!Arab!states!and!
EU!remain!outliers!
Amount!
77!
Approx!$375bn!p.a.!by!2030!
from!public!and!private!
sources!
Yes!
Ambition&
!
!
!
2050!
72!
Goal!of!70%!GHG!reduction!
relative!to!2010!
Yes!
2100!
92!
Goal!of!zero!net!emissions!
with!some!reference!to!
repairing!damage!
Yes!
Progression!
35!
No!backsliding!(with!possibility!
of!nonbinding!progression)!
Yes,!although!India!
remains!reluctant!to!
accept!the!principle!

!
!
25!
4.!Carving!Out!Issues!Makes!Agreement!More!Difficult!
!
As!noted!above,!these!analyses!assume!that!the!stakeholders!are!in!principle!willing!
to!make!trade-offs!across!all!issues.!The!negotiators!may,!however,!carve!out!or!
compartmentalize!the!negotiation!issues,!dealing!with!some!subsets!of!issues!
separately.!In!some!negotiations!this!can!be!a!wise!approach,!but!in!this!case!carving!
out!substantively!related!issues!in!this!way!makes!the!challenge!of!reaching!
agreement!more!difficult.!!We!ran!additional!scenarios!in!which!the!financial!issues,!
the!ambition!issues!and!the!remaining!issues!are!dealt!with!separately.!Table!3!
summarizes!the!results,!which!show!that!the!number!of!issues!that!become!
potential!obstacles!to!an!agreement!increases!from!three!to!nine.!
!
Carving!out!makes!it!even!more!difficult!to!reach!agreement!on!the!issue!of!Finance-
Who!Pays?!Instead!of!only!the!Arab!states!and!the!EU!being!outliers!from!the!
emerging!compromise,!Brazil!and!China!join!the!Arab!states!and!the!EU!are!outliers.!
To!the!extent!that!a!consensus!develops!on!this!issue,!it!involves!obligations!to!
contribute!for!developed!countries!only.!The!volume!of!finance!also!becomes!a!more!
difficult!issue!to!resolve!if!the!financial!issues!are!dealt!with!in!isolation.!
!
Carving!out!the!issues!relating!to!levels!of!ambition!also!makes!it!more!difficult!to!
reach!an!agreement!on!these!issues.!There!is!little!movement!from!the!stakeholders’!
current!positions.!
!
Table!3.!Summary!of!the!Exchange!Model’s!Forecasts!Assuming!Carving!Out!of!
Issues!
Issue!
Predicted!
outcome!on!
the!policy!
scale!!
Description!of!outcome!
Convergence!in!
positions?!
Differentiation!
40!if!
convergence!
achieved!
CBDR!in!the!light!of!national!
circumstance!
No.!Brazil!and!Russia!
remain!outliers!
Mitigation&
!
!
!
MRV!
69!if!
convergence!
achieved!
International!Assessment!and!
Review!
No.!EU,!Japan!and!
China!remain!outliers!
Mitigation!-Legal!
Form!
58!
Binding!agreement!plus!
obligation!to!have!(nonbinding)!
country-specific!targets!(INDCs)!
Yes!
EEA!
24!
EEA!of!aggregate!ambition!
Yes!
Adaptation&
!
!
!
Adaptation-!
Legal!Form!
79!
Non-binding!country-specific!
commitments!
Yes!
Institutions!
64!
Strengthen!existing!institutions!
with!new!powers!
Yes,!although!the!Arab!
states!remain!reluctant!
Reserved!
Financing!
74!
50%!or!more!reserved!for!
adaptation!
Yes,!although!India!and!
AILAC!continue!to!call!
for!stronger!reserves!
Loss!and!
15!
Preambular!reference!only!
Yes!

!
!
26!
Damage!
Finance&
!
!
!
Who!Pays?!
20!if!
convergence!
achieved!
Some!developing!countries!
invited!to!contribute!
No.!Arab!states,!Brazil,!
China!and!EU!remain!
outliers!
Amount!
68!if!
convergence!
achieved!
Approx!$350bn!p.a.!by!2030!from!
public!and!private!sources!
No.!Africa!group,!
AILAC,!ALBA,!AOSIS!and!
Russia!remain!outliers!
Ambition&
!
!
!
2050!
64!if!
convergence!
achieved!
Somewhat!less!than!goal!of!70%!
GHG!reduction!relative!to!2010!
No.!Little!movement!
from!initial!positions!
2100!
91!if!
convergence!
achieved!
Goal!of!zero!net!emissions!with!
some!reference!to!repairing!
damage!
No.!Little!movement!
from!initial!positions!
Progression!
56!if!
convergence!
achieved!
Clear!commitment!to!progression!
principle!
No,!India!remains!
reluctant!while!LDCs!
and!African!group!
continue!to!call!for!
stronger!commitment!!
!
5.!Concluding!Remarks!
!
The!analyses!presented!here!give!reason!for!cautious!optimism!regarding!the!
outcome!of!Paris!2015.!On!ten!of!the!thirteen!main!controversial!issues!we!forecast!
the!emergence!of!broad!consensus!among!the!main!stakeholders,!and!the!expected!
compromises!represent!substantial!progress!in!the!global!governance!of!climate!
change.!These!forecasts!assume,!however,!that!all!of!the!issues!are!kept!on!the!
agenda!at!the!same!time!during!the!conference.!If!the!negotiators!decide!to!carve!
out!certain!issues!and!deal!with!them!separately,!reaching!an!agreement!will!be!far!
more!difficult.!There!are,!moreover,!three!issues!that!will!be!particularly!challenging!
to!resolve:!Differentiation;!Mitigation!MRV;!and!Finance!Who!Pays?!We!gave!details!
of!the!specific!stakeholders!that!will!have!particular!objections!to!the!emerging!
compromises!on!each!of!these!issues.!We!also!forecasted!that!Brazilian!and!Chinese!
representatives!will!perceive!losses!from!the!negotiation!process.!These!
stakeholders!therefore!need!to!be!offered!good!reasons,!if!necessary!in!the!form!of!
special!provisions,!to!accept!the!agreement!that!emerges.!
!
This!study!is!part!of!a!larger!research!project!involving!Professor!Bruce!Bueno!de!
Mesquita!(New!York!University),!Professor!Detlef!Prinz!(Potsdam!University)!and!
several!researchers!at!the!Oslo!Climate!Institute!Cicero.!Our!colleagues!are!applying!
a!range!of!complementary!approaches!to!forecasting!the!process!and!outcomes!of!
Paris!2015.!These!include!the!application!of!the!non-cooperative!game!theoretic!
model!by!Professor!Bueno!de!Mesquita!of!NYU.!Another!approach!involves!the!
systematic!collection!of!experts’!predictions!of!the!negotiation!outcomes.!After!the!
conference!has!been!held,!we!intend!to!return!to!our!forecasts!to!assess!their!
accuracy!and!usefulness.!
! !

!
!
27!
Selected!references!
!
Bueno!de!Mesquita,!B.!and!F.N.!Stokman.!eds.!1994.!European&Community&Decision&
Making:&Models,&Applications,&and&Comparisons.!New!Haven:!Yale!University!
Press.!
Dijkstra,!J.,!M.A.L.M.!Van!Assen,!F.N.!Stokman.!2008.!Outcomes!of!collective!
decisions!with!externalities!predicted.!Journal&of&Theoretical&Politics!20,!414-441.!
Stokman,!F.N.,!J.!Van!der!Knoop,!R.C.H.!Van!Oosten.!2013.!Modeling!collective!
decision!making.!In!V.!Nee,!T.A.B.!Snijders!and!R.!Wittek.!eds.!Handbook&of&
Rational&Choice&Social&Research.!Stanford!CA:!Stanford!University!Press,!pp.!151-
82.!
Thomson,!R.,!F.N.!Stokman,!C.!Achen,!and!T.!Koenig.!eds.!2006.!The&European&Union&
Decides.!Cambridge:!Cambridge!University!Press.!
!

!
!
28!
Appendix!!
!
Graphs!of!the!remaining!issues!on!which!the!Exchange!Model!forecasts!convergence.!
!
Ex!Ante!Assessments!
The!issue!of!Ex!Ante!Assessments!(EEAs)!concerns!the!provisions!to!be!included!for!
assessment!and!review!of!the!nationally!determined!contributions.!The!main!alternatives!on!
the!0-100!policy!scale!are:!
0:!Option!1:!No!EAA&
20:!Option!2:!EAA!of!aggregate!ambition&
60:!Option!3:!EAA!of!aggregate!ambition!and!technical!EAA!of!individual!INDCs!
(transparency,!clarity,!comparability,!etc.)!&
90:!Option!4:!Option!3!plus!a!political!assessment!of!individual!INDCs!(ambition!and!
equity/fairness)!
100:!Option!5:!Option!4!and!a!formal!mechanism!for!involving!inputs!from!civil!society!
!
Figure!11.!Stakeholders’!Positions!on!the!Issue!of!Ex!Ante!Assessments!
Note:!Salience!scores!in!parentheses!
!
!
Figure!12.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Ex!Ante!Assessments!

!
!
29!
Adaptation!Legal!Form!
This!issue!focuses!on!the!question!of!the!extent!to!which!countries’!new!commitments!to!
adaptation!targets!should!be!country-specific!and!legally!binding.!The!alternatives!on!the!0-
100!policy!scale!are:!
0:!No!new!commitments!to!adaptation!
40:!Collective,!non-binding!provisions.!E.g.!“all!parties!are!encouraged!to!integrate!
adaptation!into!their!national!plans”!
80:!Non-binding!country-specific!commitments!
100:!Legally!binding!country-specific!commitments!
!
Figure!13.!Stakeholders’!Positions!on!the!Issue!of!Adaptation!Legal!Form!
Note:!Salience!scores!in!parentheses!
!
!
Figure!14.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Adaptation!Legal!Form!

!
!
30!
Adaptation!Institutions!
To!what!extent!should!the!institutional!framework!for!adaptation!be!strengthened?!Here,!
the!positions!on!the!0-100!policy!scale!are:!
0:!No!strengthening!
60:!Strengthen!present!institutions!(stronger!mandate,!funding!and!knowledge!platform)!
80:!Establish!new!institutions!stronger!than!present!ones.!
100:!Establish!subsidiary!body!on!adaptation!
!
Figure!15.!Stakeholders’!Positions!on!the!Issue!of!Adaptation!Institutions!
Note:!Salience!scores!in!parentheses!
!
!
Figure!16.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Adaptation!Institutions!
!
!
!

!
!
31!
Adaptation!Reserved!Financing!
To!what!extent!should!funds!be!reserved!for!adaptation?!
0:!No!earmarking!for!adaptation!
50:!Approximately!50%!earmarked!for!adaptation!
100:!Dedicated!levy!for!adaptation!
!
Figure!17.!Stakeholders’!Positions!on!the!Issue!of!Adaptation!Reserved!Financing!
Note:!Salience!scores!in!parentheses!
!
!
!
Figure!18.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Adaptation!Reserved!Financing!
!
!
!

!
!
32!
Loss!and!Damage!
To!which!degree!will!loss!&!damage!(L&D)!be!included!in!an!agreement?!
0:!!No!mention/omission!of!L&D!
10:!!Preambular!reference!only!
20:!!Reference!to!Warsaw!International!Mechanism!(WIM)!(under!adaptation)!
30:!!Separate!chapter!on!L&D!with!little!substance!
40:!!Separate!chapter!on!L&D!and!new!institutional!arrangements!with!little!substance!
50:!!Separate!chapter!on!L&D!and!new!institutional!arrangements!with!new!non-
financial!elements!(such!as!coordination!and!capacity-building)!
70:!!Separate!chapter!on!L&D!and!new!mechanism!with!new!non-financial!and!financial!
elements!(such!as!insurance)!but!no!compensation!regime!
100:!!Separate!chapter!on!L&D!and!new!non-financial!and!financial!elements,!including!a!
compensation!regime!
!
Figure!19.!Stakeholders’!Positions!on!the!Issue!of!Loss!and!Damage!
Note:!Salience!scores!in!parentheses!
!
Figure!20.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Loss!and!Damage!

!
!
33!
Finance!Amount!
What!amount!of!funds!should!be!be!mobilized!(private!and!public)!by!2030!(p.a.)?!
0:!no!new!target!(i.e.!$100b!p.a.)!
20:!Unspecified!increase!above!$100b!p.a.!
40:!$!200b!p.a.!
60:!$!300b!p.a.!
80:!$!400b!p.a.!
100:!≥$500!b!(in!excess!of!1%!of!present!OECD!GDP!p.a.)!
!
Figure!21.!Stakeholders’!Positions!on!the!Issue!of!Finance!Amount!
Note:!Salience!scores!in!parentheses!
!
!
Figure!22.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Finance!Amount!
!
!
!

!
!
34!
Ambition!2050!
What!mitigation!goal!should!be!set!for!2050?!
0:!No!2050!goal!
20:!Qualitative!goal!
30:!Qualitative!goal!with!a!roadmap!
50:!Goal!of!40%!GHG!reduction!relative!to!2010!
70:!Goal!of!70%!GHG!reduction!relative!to!2010!
100:!Goal!of!zero!net!emissions!
!
Figure!23.!Stakeholders’!Positions!on!the!Issue!of!Ambition!2050!
Note:!Salience!scores!in!parentheses!
!
!
Figure!24.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Ambition!2050!
!
!
!

!
!
35!
!
Ambition!2100!
What!mitigation!goal!should!be!set!for!2100?!
0:!No!2100!goal!
20:!Qualitative!goal!
30:!Qualitative!goal!with!a!roadmap!
80:!Goal!of!zero!net!emissions!
100:!Goal!of!negative!net!emissions!!
!
Figure!25.!Stakeholders’!Positions!on!the!Issue!of!Ambition!2100!
Note:!Salience!scores!in!parentheses!
!
!
Figure!26.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Ambition!2100!
!
!
!
!
!

!
!
36!
Ambition!Progression!
What!should!be!the!mechanism!for!strengthening!commitments!over!time?!
0:!No!ambition!mechanism!
30:!No!backsliding!principle!
40:!A!non-binding!progression!principle!
65:!A!binding!progression!principle!
100:!A!binding!commitment!to!strengthen!targets!in!line!with!the!2!degrees!goal!
!
Figure!27.!Stakeholders’!Positions!on!the!Issue!of!Ambition!Progression!
Note:!Salience!scores!in!parentheses!
!
!
Figure!28.!The!Exchange!Model’s!Forecasts!on!the!Development!of!Stakeholders’!Positions!
on!the!Issue!of!Ambition!Progression!
!
!
!