Climate clubs: an experimental study of Nordhaus’ proposal to mitigate climate change

<ns3:p>Background Climate change poses a global collective action challenge, requiring mechanisms that can sustain cooperation among nations. Nordhaus proposed the concept of “climate clubs” as a voluntary institutional framework to overcome free-riding in international climate policy by linking participation to mutual benefits and sanctions. This study experimentally examines whether such clubs can promote and stabilize cooperation in heterogeneous groups. Methods We conducted controlled online experiments in which participants, representing countries with different endowments, decided whether to form voluntary coalitions that coordinated emissions reductions. Four treatments were compared, varying in club formation rules (unanimity versus majority) and in the presence or absence of sanctions for non-members. Participants’ pledges, commitments, and contributions were tracked across repeated rounds to assess both cooperation levels and coalition stability. Results Climate clubs significantly increased and stabilized cooperation relative to the baseline public goods game. The unanimity rule fostered more robust coalitions by enhancing commitment, but it did not necessarily raise overall contribution levels. By contrast, sanctions for non-members strongly incentivized high-endowment participants to contribute more and to sustain their participation. Cooperation under sanctioning conditions remained high and less variable across rounds, indicating that enforcement mechanisms reinforced stability and resilience in collective action. Conclusions Our results show that Nordhaus’ climate club framework can effectively promote enduring cooperation when supported by credible sanctions. While unanimity rules strengthen collective commitment, they are not required to achieve high cooperation levels. These findings suggest that climate clubs represent a promising institutional approach to achieving stable, inclusive, and sustained international cooperation in climate mitigation.</ns3:p>