Working Paper: NBER ID: w31421
Authors: Rachel Glennerster; Seema Jayachandran
Abstract: Reductions in greenhouse gas emissions are a global public good, which makes it efficient to act globally when addressing this challenge. We lay out several reasons that high-income countries seeking to mitigate climate change might have greater impact if they invest their resources in opportunities in low- and middle-income countries. Specifically, some of the easiest and cheapest options have already been tapped in high-income countries, land and labor costs are lower in low- and middle-income countries, it is cheaper to build green than to retrofit green, and global targeting matters in integrated economies. We also discuss economic counterarguments such as the challenge of monitoring emissions levels in low- and middle-income countries, ethical considerations, the importance of not double-counting mitigation funding as development aid, and policy steps that might help to realize this opportunity.
Keywords: greenhouse gas emissions; climate change; low and middle-income countries; high-income countries; cost-effective mitigation
JEL Codes: F18; O13; Q54; Q56
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| High-income countries' investments (O57) | Mitigation opportunities in low and middle-income countries (O54) |
| Cost-effectiveness of mitigation strategies (O22) | Effectiveness of investments (G11) |
| Remaining opportunities in low and middle-income countries (O15) | Cost-effective emissions reductions (Q52) |
| Limited access to capital (O16) | Fewer pursued mitigation opportunities (H84) |