Creating effective energy policy is hard, in part because it often requires effective international coordination. For most salient energy-related issues – such as control of the emissions that cause global climate change or the building of stockpiles to make oil supplies more secure – international coordination is inherently difficult. Solutions lie in making these problems more manageable by working in small groups of relevant countries; successful cooperation also hinges on finding incentive-compatible commitments that align, to the extent feasible, with national interests and are focused on areas where cooperation will yield tangible joint gains. The outcomes of such cooperation efforts are likely to be decentralized complexes of networked institutions rather than integrated, hierarchical treaties that govern a coherently defined issue-area.

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