Climate policies under wealth inequality

Significance One of the greatest challenges in addressing global environmental problems such as climate change, which involves public goods and common-pool resources, is achieving cooperation among peoples. There are great disparities in wealth among nations, and this heterogeneity can make agreements much more difficult to achieve (e.g., regarding implementation of climate change mitigation). This paper incorporates wealth inequality into a public goods dilemma, including an asymmetric distribution of wealth representative of existing inequalities among nations. Without homophily (imitation of like agents), inequality actually makes cooperation easier to achieve; homophily, however, can undercut this, leading to collapse because poor agents may contribute less. Understanding such effects may enhance the ability to achieve agreements on climate change and other issues.