There are two fundamental political economy facts that must be taken into account in efforts to address climate change through international cooperation:

• Climate change mitigation through reductions in GHG emissions is a global public good. The benefits of mitigation are thus available to all countries, regardless of whether they participate in the mitigation efforts.

• Because the international nation-state system is highly decentralized and generally lacking in formalized enforcement mechanisms, it is a challenge to gain participation and compliance in international climate change agreements.

It is therefore tempting for countries to be free riders through non-participation and/or non-compliance, and these core conditions pose formidable obstacles to the achievement of environmentally effective, economically efficient, and politically viable international agreements.

Yet, progress in the development of an international climate regime has nevertheless been made incrementally over more than two decades. In order to understand the evolution of the system and the constraints on it, it is necessary to consider some key issues and the context in which they are addressed. As we have seen in the previous two chapters, international issues overlap with regulating emissions (Chapter 5) and advancing technologies (Chapter 6); but in addition, there is a wide range of other international issues – including institution-building, financing adaptation and mitigation projects in developing countries, and monitoring, reporting, and verifying emissions and mitigation actions.