In: Economics
Climate change describes a change in the average conditions — such as temperature and rainfall — in a region over a long period of time. NASA scientists have observed Earth’s surface is warming, and many of the warmest years on record have happened in the past 20 years.
Why is a global agreement so difficult to achieve?
The negative externalities from activities that emit GHGs are not borne solely by the citizens of the countries where they are emitted, since they are exported to neighbouring countries, and to the rest of the planet as well. Similarly, the benefits of reducing GHGs are not enjoyed solely in the country that implements mitigation policies, but by people in all countries. Governments therefore have an incentive to behave like free riders, which is to say, to benefit from the GHG reductions of others without themselves contributing to reduction efforts that would impose costs on their citizens.
In order to eliminate this incentive and ensure that all countries live up to their commitments, it is logical to try to establish a binding international agreement that would impose penalties for missing targets. The need for an agreement to be binding, however, reduces the chances of signing one, since countries prefer voluntary, non-binding reduction targets.
The differing economic contexts of different countries also make the signing of a binding agreement very difficult. The principle of “common but differentiated responsibility,” which recognizes that all countries have a role to play but which takes into account the particularities of each, is a good illustration of the divergent interests of industrialized and developing countries.
Industrialized countries, which are responsible for the majority of GHG emissions to date, will have less impact in the future since the proportion of emissions from less developed countries is growing. Moreover, the impact of the climate change so far caused by the emissions of industrialized countries will be disproportionately felt in developing countries. Their lower adaptive capacity, which is proportional to wealth levels, makes them more vulnerable.
Industrialized countries will not sign a binding agreement without a non-negligible contribution from those who will have high growth rates in the coming years. For their part, poorer countries demand targets that are adapted to their situation, as well as financial support for their energy transition, since their current wealth levels do not allow them to forgo the affordable energy supplied by fossil fuels.
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