1.3.1 What Is the Challenge?
The challenge of climate change mitigation from an equity perspective is to
ensure that neither the impact of climate change nor that of mitigation policies
exacerbates existing inequities both within and across nations. The starting
point for describing this challenge is the vast range of differences in incomes,
opportunities, capacities, and human welfare, both between and within countries.
This is combined with the fact that carbon emissions are closely correlated
to income levelsboth across time and across nationswhich suggests
that restrictions on such emissions may have strong distributional effects (Parikh
et al., 1991; Parikh et al., 1997b; Munasinghe, 2000).
Income and consumption, as well as vulnerability to climate change, are distributed
unevenly both within and between countries.6
Concerns about the disproportionate impacts of climate change on developing
countries are mirrored in similar fears with regard to poor and vulnerable communities
within developing countries (Jamieson, 1992; Ribot et al., 1996; Reiner and
Jacoby, 1997). Similarly, issues of intergenerational equity have been raised
to caution against shifting the burden of adjustment to future generations,
which cannot influence political choices today (see Weiss, 1989),7
a theme picked up in Section 1.4 below.
Academic and policy interest has focused on income distribution as well as
the poverty that underlies it. Global poverty statistics are compelling. Over
1.3 billion people, or more than one-fifth of the global population, are estimated
to be living at less than US$1 per day. Other measures of poverty and vulnerabilitylack
of access to health, education, clean water, or sanitationyield higher
estimates of poverty. Since poverty is concentrated in non-Annex I countriesespecially
South Asia and Africawhose average per capita income is less than one-quarter
(in dollars of constant Purchasing Power Parity) of the average for developed
countries (UNDP, 1999; World Bank, 1999), equity concerns have focused on differences
between rather than within countries.
Figure 1.4: Global distribution of income and population.
Figure 1.5: Per capita carbon emission and income.
The distributional dimension of global poverty was illustrated vividly by the
Human Development Report 1989 (UNDP, 1989), in the form that has come to be
known as the champagne glass (Figure 1.4). This
representation of global income distribution shows that in 1988 the richest
fifth of the worlds population received 82.7% of the global income, which
is nearly 60 times the share of the income received by the poorest fifth (1.4%).
More recent statistics indicate that inequality has widened further since then
and that in 1999 the richest quintile received 80 times the income earned by
the poorest quintile (UNDP, 1999).
Besides average income levels, Annex I and non-Annex I countries differ in
other ways, most importantly in terms of the capacity for collective action
and access to technology and finance. Many non-Annex I countries face problems
of governance because of weak administrative infrastructures, failure to invest
in human and institutional capacity, lack of transparency and accountability,
and a high incidence of civic, political, and regional conflicts (World Bank,
1992; UNDP, 1997; Kaufmann et al., 1999; Knack, 2000; Thomas et al., 2000).
They also house a less than proportionate fraction of R&D infrastructure,
and consequently lack access to technology and innovation. This is especially
important in issues of global environmental change, which are strongly science-driven
areas (Jamieson, 1992; Ramakrishna, 1992; Najam, 1995; Agarwal and Narain, 1999).
Finally, many (though not all) of these countries are over-exposed to international
debtand their governments to domestic debtand thus have less flexibility
in the choice of policy options (World Bank, 1998).
Notwithstanding the diversity of initial conditions in various countries, they
share a common commitment to the goal of economic growth, partly for its own
sake and partly because it is perceived as one of the means of poverty eradication
and capacity development. However, most analysts recognize that growth alone
is not a solution and it needs to be combined with ancillary policies and safeguards
to protect environmental and social resources. In fact, while national economic
growth appears to be correlated with a reduction in poverty levels (and neutral
with regard to national income distribution), over the past 50 years global
income growth has been accompanied by a worsening of global income distribution
(World Bank, 2000) and a persistence of poverty.8
The concept of sustainable development has incorporated distributional aspects
mainly in response to these concerns (see Lélé, 1991; Murcott,
1997). Be that as it may, economic growth continues to be the centre of government
policies and plans.
This is relevant to climate change mitigation, since a fairly robust stylized
fact of historical development, consistent with both cross-country and time-series
data, is the close correlation between economic growth and carbon emissions.
Figure 1.5, for example, presents cross-country
data on per capita carbon emissions and income (in US$(PPP); see also Box
1.1 on a controversy over the representation of data). The bold trend line
highlights the proportionate increases (or, as in some economies in transition
recently, decreases) in per capita emissions and income over time. Broadly speaking,
developed countries have per capita incomes over US$(PPP)20,000 and carbon emissions
between 2 and 6 tonnes per capita. Non-Annex I countries have much lower incomes
and much lower emissions, while the economies in transition fall in the middle
of the range. In particular, the bulk of the worlds poor live in a smaller
number of non-Annex I countries, which are bunched at the bottom left corner
of the graph, with incomes below US$(PPP)5,000 per capita, and emissions below
| Box 1.1. A Numbers Game
A persistent theme in the literature is the explicit or implicit assignment
of responsibility for global warming trends. Without going into the merits
of the issue, it is useful to point out that many of the arguments revolve
around the appropriate way to represent the data. For example, Agarwal and
Narain (1991a) criticize the uncritical use of aggregate national emissions
figures, which could imply parity between developed countries and large
developing countries (China, India, and Brazil) mainly because of the large
populations of the latter. Instead, they recommend the use of per capita
net emissionsthat is, emissions that exceed the per capita
absorptive capacity of global carbon sinks. Other analysts distinguish between
necessary and luxury emissions (Agarwal et al.,
1999; Shue, 1993).
Another theme is the relative impact of CO2 emissions and that of other
GHGs and land-use changes, given that the latter are less strongly correlated
with per capita income. Most analyses have focused on CO2 emissions, given
that it constitutes the bulk of the contribution to global warming. Others
suggests that CO2 emissions are accompanied by forced cloud changes and
tropospheric aerosols, which offset their warming impact (Hansen et al.,
2000). There are also debates over the precision of the estimates of these
associated offsets, as well as those of methane emissions in developing
countries (Agarwal et al., 1999). For example, Parikh et al. (1991) identify
potentially serious problems with World Resources Institutes deforestation
estimates (WRI, 1991); and Parikh (1992) shows how the IS92 IPCC scenarios
may have been formulated with developed country interests hard-wired into
them such that they could be very unfair to the developing countries.
In response to this criticism some of the new SRES scenarios (IPCC, 2000a)
explicitly explore scenarios with a narrowing income gap between the developed
and developing countries.
Finally, per capita is not the only relevant normalization
(Najam and Sagar, 1998), since emissions per unit of income can also indicate
potential for efficiency improvements. Besides annual emissions, data
can also be presented in terms of atmospheric concentrations, or the contribution
to the global average temperature, each of which has slightly different
implications for the responsibility for climate change. Given the uncertainties
involved in constructing such estimates, the picture is not entirely clear.
However, most estimates suggest that the developing countries may overtake
Annex I countries, in terms of total annual emissions, in another 1520
years, and in terms of the contribution to the global average temperature
increase in 6090 years (Hasselmann et al., 1993; Enting, 1998; Meira,
1999; Pinguelli Rosa and Ribeiro, 2000).
Useful analytical tools in this regard are various decomposition approaches9
that represent carbon emissions as the product of three factors, carbon intensity
(emissions per unit of income), affluence (income per capita), and population.
The decomposition suggests that reconciliation of the goals of emissions abatement
and economic growth must involve a combination of population decline and technological
and managerial improvements that lead to lower carbon intensity. Some potential
for improvement is evident from Figure 1.5, namely
the large differences in per capita emissions of countries and regions at the
same level of affluence (e.g., Hong Kong, Switzerland, Singapore, Japan, and
the USA). This suggests the possibility of technological leap-frogging
(see Goldemberg, 1998a, Schneider, 1998), that is the lowering of emissions
by a factor of two or three without impacting income levels through investment
in technological development and capacity building.10
However, the operational and other obstacles against the realization of these
possibilities have not been analyzed systematically in the literature.
In the absence of such investment, economic growth and conventional economic
development are likely to remain strongly linked to the ability to emit unlimited
amounts of carbon. Therefore, restrictions on emissions will continue to be
viewed by many people in developing countries as yet another constraint on the
development process. The mitigation challenge, therefore, is to decouple growth
and economic development from emission increases.
However, mitigation policies in general, and its decoupling from economic growth
in particular, have to be designed with specific contexts in mind. Policies
designed for one context are generally not appropriate for another (Shue, 1993;
Rahman, 1996; Jepma and Munasinghe, 1998), and identical ultimate goalsstabilization
of GHG accumulation and maintenance or achievement of the quality of lifeyield
different priorities and strategies in Annex I and non-Annex I countries. In
the former, these goals are translated as reducing emissions while improving
the quality of life, and in the latter it is the other way aroundimproving
the quality of life, inter alia, by maintaining the rate of economic growth,
while maintaining or lowering per capita emissions.
The current global response to this situation is to exempt non-Annex I countries
from climate obligations to allow them to pursue their developmental goals freely.
Furthermore, UNFCCC as well as subsequent agreements stipulate the provision
of financial and technological resources for voluntary mitigation actions by
this group of countries. Finally, the Kyoto Protocol created the CDM to enable
developing countries to contribute to emissions abatement while pursuing sustainable
As non-Annex I emissions continue to grow, however, this strategy may become
inadequate, and more innovative mitigation efforts might be called for in non-Annex
I countries. This will mean divergences of the development path of the currently
developing countries from that which developed countries have displayed (Munasinghe,
1994; Jacoby et al., 1998; Najam and Sagar, 1998; Barrett, 1999). As the UNDP
Human Development Report (1998, p.7) points out, Poor countries need to
accelerate their consumption growth but they need not follow the path
taken by the rich and high-growth economies over the past half century.
Some simple calculations can help illustrate the nature of the global mitigation
challenge. Current per capita carbon emissions are slightly more than 3 tonnes
per year in Annex I countries and slightly less than 0.5 tonnes per year in
non-Annex I countries. With about 1.3 billion people living in Annex I countries
and about 4.7 billion in non-Annex I countries, total carbon emissions are in
the range of (3.1)(1.3) + (0.48)(4.7) = 6.29 billion tonnes. Thus carbon emissions
at a global scale average about 1 tonne per capita per year. The stabilization
of CO2 concentrations in the atmosphere at 450, 550, 650, and 750ppmv will require
steep declines in the aggregate emissions as well emissions per capita and per
dollar of gross domestic product (GDP) as illustrated in the IPCC SAR Synthesis
Report (IPCC, 1996). For example, based on the SAR Synthesis Report and a recent
set of calculations by Bolin and Kheshgi (2000), stabilization of CO2 concentrations
in the atmosphere at 450, 550, 650, and 750ppmv would require limiting fossil-fuel
carbon emissions at about 3, 6, 9 and 12 billion tonnes, respectively, by 2100
and further reductions thereafter to less than half current global emissions.
If, for example, the world population stabilized at about 10 billion people
by then, an average carbon emissions per capita of 0.3, 0.6, 0.9, and 1.2 tonnes
of carbon would be required to achieve the 450, 550, 650, and 750ppmv limits,
respectively. We make no assumption here about how these emissions would or
should be allocated globally, but simply report that the average by 2100 must
work out to these levels to achieve the stabilization objectives. Thus, to achieve
a 450ppmv concentration target, average carbon emissions per capita globally
need to drop from about 1 tonne today to about 0.3 tons in 2100; to achieve
a 650ppmv target they need to drop to 0.9 tonnes (about one-quarter of current
emissions per capita in the Annex I countries) by 2100 and further thereafter.
Finally, with a global economy currently producing about 25 trillion dollars
of output, carbon emissions per million dollars of output are currently about
240 tonnes. If, for example, the global economy grows to 200 trillion dollars
of output by 2100, the emissions per million dollars (in year 2000 dollars)
would need to be limited to about 10, 25, 40, and 55 tonnes of carbon in order
to achieve the 450, 550, 650, and 750ppmv CO2 limits, respectively. If further
population and economic growth continues beyond 2100 additional reductions in
average emissions per capita and per unit of economic output would be required.
This framing of the mitigation challenge is central to the literature on global
equity and climate change. Virtually all stabilization trajectories in the literature
show an initially rising trend of aggregate global emissions, followed by a
declining trend; and they also show a gradual narrowing of the gap between per
capita emissions of various countries and regions. In many of these scenarios,
over a finite period of time, aggregate net global emissions contract to levels
consistent with the absorptive capacity of global sinks, while per capita emissions
of Annex I and non-Annex I countries move towards convergence in the interest
of global equity. One possible international regime to achieve stabilization
would initially have only Annex I emissions decline over a period of time (to
make room for the growth prospects and therefore rising emissions of non-Annex
I countries). At the same time, as per capita emissions of both groups decline
and converge, aggregate emissions also declinein some scenarios to close
to a carbon-free situation. There are in principle many other approaches to
an equitable international regime, that are discussed in Section
For the purposes of this chapter, it is convenient to divide the required emissions
trajectory into three segments. Phase 1, an upward sloping segment of the non-Annex
I trajectory, may require only marginal deviations in baseline emissions, for
which the assessment of policy options entails a central attention to the costs
and benefits of mitigation. However, for options relevant for Phase 2, a downward
sloping segment of non-Annex I emissions, in which deeper cuts may be called
for, global equity issues will need greater attention. Finally, the policy options
that can help realize Phase 3, the asymptotic segment of the trajectory, revolve
to a greater extent around sustainability concerns.