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Trade and Climate Change: The Challenges Ahead

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  • Nicole A. MATHYS

    (Swiss Federal Office of Energy (SFOE))

  • Jaime de MELO

    ()
    (Ferdi)

Abstract

The outcome of the 15th conference of the Parties to the UNFCC showed a shift from a top-down approach with a collective target favoring environmental objectives to a bottom-up accord favoring political feasibility, with no meaningful binding agreement in sight, as the global climate regime and the global trade policy regime represented by the WTO appear to be on a collision course. Following a review of the alternative architectures for the next Climate Change Agreement, the paper outlines four areas in which trade will play a role: as a purveyor of technological transfer; as a mechanism to separate where abatement takes place from who bears the cost of abatement; as a participation mechanism; and as a way to address the pressures for border adjustments. Political-economy considerations are invoked to predict that a target system with a carbon credit system will be preferable to a carbon tax or to a portfolio system of treaties.

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Bibliographic Info

Paper provided by FERDI in its series Working Papers with number P14.

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Date of creation: Oct 2010
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Handle: RePEc:fdi:wpaper:669

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Citations

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Cited by:
  1. Henrik HORN & Petros C. MAVROIDIS, 2011. "To B(TA) or not to B(TA)? On the Legality and Desirability of Border Tax Adjustments from a Trade Perspective," Working Papers P21, FERDI.
  2. Aichele, Rahel & Felbermayr, Gabriel, 2012. "Kyoto and the carbon footprint of nations," Munich Reprints in Economics 20163, University of Munich, Department of Economics.
  3. Nicole A. MATHYS & Jaime de MELO, 2011. "The Political Economy of Climate Change Policies: Political Economy Aspects of Climate Change Mitigation Efforts," Working Papers P24, FERDI.
  4. Jaime de Melo, 2012. "Trade in a 'Green Growth' Development Strategy Global Scale Issues and Challenges," Working Papers 2012.47, Fondazione Eni Enrico Mattei.
  5. Harun Onder, 2012. "Trade and Climate Change : An Analytical Review of Key Issues," World Bank Other Operational Studies 10036, The World Bank.
  6. Patrick MESSERLIN, 2011. "Climate, trade and water: A “grand coalition”?," Working Papers P23, FERDI.
  7. Patrick MESSERLIN, 2011. "Climate, trade and water: A “grand coalition”?," Working Papers P23, FERDI.
  8. Nicole A. MATHYS & Jaime de MELO, 2012. "Reconciling Trade and Climate Policies," Working Papers P37, FERDI.
  9. Rahel Aichele, 2013. "Trade, Climate Policy and Carbon Leakage - Theory and Empirical Evidence," ifo Beiträge zur Wirtschaftsforschung, Ifo Institute for Economic Research at the University of Munich, number 49.

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