The equity and development dimensions in the Paris agreement : assessment and policy responses

Abstract

This doctoral dissertation investigates equity and development issues in the context of the Paris Agreement. It first provides an overview of the main elements of the Paris Agreement, complemented by an assessment of how the equity principle is addressed in the final text and how its implementation has evolved over time within the UNFCCC process. The analysis then evaluates the Nationally Determined Contributions (NDCs), which represent a crucial element of the agreement, according to different metrics based on equity. The third chapter uses a recursive-dynamic Computable General Equilibrium model coupled with an empirical analysis on past data to quantitatively estimate the future impacts of the mitigation objectives, included in the NDCs, on developing countries’ poverty and inequality, emphasizing also the relationship between climate change and two important Sustainable Development Goals. The research then explores the role of climate finance tools in offsetting potential trade-offs induced by the climate policy, focusing in particular on the effects of different allocation schemes of the Green Climate Fund on GDP and clean energy deployment. Overall findings suggest that the concept and implementation of the equity principle within the UNFCCC changed over the years, with the Common but Differentiated Responsibility losing its initial influence. Although the Paris Agreement abandoned the Annex I/non-Annex I countries dichotomy, the new language is not clear enough to avoid future challenges. In addition, the mitigation contributions proposed by countries are far from being consistent with the objectives of the Paris Agreement in terms of both stringency and equity. A significant gap affects the NDCs of major emitters with the only exception of India. Looking at the development opportunities, the analysis shows that the Paris Agreement is projected to slow down poverty reduction efforts, especially in countries that proposed a relatively more stringent mitigation objective. The aggregate effect, however, is not so broad. Conversely, potential synergies emerge between climate change interventions and within-country income inequality. Finally, the Green Climate Fund can play an important role in compensating for the cost of climate policy, even though the current distribution of funds could not incentivize countries to propose more ambitious emission reduction targets.