This paper documents evidence that global climate change target can not be
achieved only by Annex countries’ mitigation activities without Non-Annex
countries’ effort and cooperation. I assume there are two countries and
non-perfect competition market. In the result, an Annex country can achieve
abatement target, but the emission of a Non-Annex country increases due to
its “emission concentration”. So global emission target can’t be achieved. In
other scenario, where Non-Annex country enforces a self-regulation by
imposing emission target or invites CDM, global emission can be achieved.
But global welfare decreases in the former case. In the last scenario, the
mixed strategy of self-regulation and CDM, global emission target can be
achieved and it has minimum welfare losses.