What type of climate funding for developing countries do we support?

It is often stressed that developing countries need large financial support in order to cut greenhouse-gas emissions and to reduce climate-change related risks. But will people in rich countries be willing to provide the necessary amounts of money in times when budgets are tight? And are there characteristics that influence public support?

Vergrösserte Ansicht: Climate Summit September 2014
The UN held its last Climate Summit on September 23. (United Nations Photo / flickr)

Many policymakers and scientists argue that North-South financial transfers in the order of $100 billion per year will be required to obtain commitments for greenhouse-gas reductions from developing countries and emerging economies, and to help protect poor countries from climate-related risks. At the United Nations’ Climate Summit [1] on September 23, heads of state from developing and developed countries stressed the need to scale up both public and private climate finance instruments.

But will rich countries be willing to provide the amounts needed over longer periods of time? And will populations in likely donor countries, such as the United States and Germany, approve of such large financial flows from their public purses at times when government budgets are being cut? Assuming that policymakers pay at least some attention to what voters prefer, climate funding mechanisms need to be designed carefully so as to garner enough public support.

Insight into public support for North-South climate funding

We implemented two nationally representative survey experiments in the United States and Germany to study this question (1,500 respondents were in each study). The results [2] offer, for the first time, quantitative and systematically comparable insight into public perceptions of large-scale North-South climate funding.

We used a so-called conjoint experiment to estimate whether and how much particular characteristics of North-South climate funding are likely to affect public support. Participants were confronted with sets of proposals for funding schemes that had a fixed set of attributes. These attributes describe characteristics of countries entitled to receive the funding, how funding decisions are made, the general purpose of funding (adaptation vs. mitigation), and how much other donor countries contribute.

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The Results

The results provide insight into the effects of distinct design elements on public support for climate funding, but also into combinations of policy design features that are more (or less) popular. The figure below reveals some effects that are quite intuitive, whereas others are quite surprising.

Vergrösserte Ansicht: Graph showing the survey results
The results indicate the most (and least) popular climate funding schemes among American and German respondents. (Graph: Thomas Bernauer / ETH Zurich)

To start with, surprisingly, the magnitude of expected climate-change damage in recipient countries plays no significant role. Also, rather unexpectedly, income levels in recipient countries do not affect public support for climate funding. The same holds true for per-capita greenhouse-gas emissions in recipient countries. However, government efficiency in recipient countries has the expected effect; support for funding efficient foreign governments was about 5 percent to 9 percent higher than support for less efficient governments. Overall, however, recipient country characteristics do not substantially influence public support for climate-funding mechanisms.

Decision-making

Contrary to our expectation, populations in donor countries are willing to accept joint decision-making on funding allocation, rather than leaving funding decisions to donors alone. Funding schemes in which recipients control the decision-making process are, unsurprisingly, least acceptable to populations.

Adaptation and mitigation

Populations in both countries consider funding for adaptation alone least acceptable, and funding for both mitigation and adaptation most acceptable.

Burden sharing

Burden sharing between donor countries has by far the largest effect in both countries. The larger the contribution share of other countries compared to the respondent’s country, the more likely respondents are to select this proposal. This result suggests that climate funding is very much viewed as a burden-sharing problem, where some distributional equity among donors is considered essential.

Lower contribution shares of other countries might also be considered as free-riding, which would undermine the overall problem-solving effectiveness of funding, thus leading to a drop in public support.

American vs. German preferences

The most popular climate funding scheme among American respondents provides funding to recipient countries with moderate climate damages, considerably lower income than the United States, similar emissions and a highly efficient government. It is based on joint decision-making, funding is used for mitigation and adaptation, and the U.S. contribution is rather small (10 percent) relative to other countries’ contribution. The probability of this proposal gaining acceptance is 50.3 percentage points higher than acceptance of a proposal consisting of the baseline attribute values.

The most popular climate-funding scheme among German respondents – which is quite similar to the American one – has a 46.5 percent higher probability of being selected of compared to the baseline proposal.

Implications for climate policy makers

One implication of these findings is that finance mechanisms that focus primarily on compensating developing countries, without contributing to the global public good of mitigation, are unlikely to garner much public support. Similarly, discourses focusing on developing countries’ needs and differences in historical responsibility are unlikely to be very conducive. Instead, greater attention should be paid to burden-sharing equity among donor countries, and to options for increasing the efficiency of use of money in recipient countries.

Nonetheless, citizens seem to support relatively large contribution shares from their country. Even funding schemes where only a small coalition of perhaps five to 10 countries contribute could thus be politically feasible. The often-debated proposal of ambitious “climate clubs” looks like a realistic option not only in the area of climate policy more generally (see also an earlier contribution by Bechtel and Scheve to Monkey Cage [3]), but also in the area of climate finance.

 

This blog post is based on an externe Seitearticle originally published on the Washington Post’s externe SeiteMonkey Cage, a rewarded blog trying to make some sense of the circus that is politics. The article was co-written by Robert Gampfer and Aya Kachi. Both are post-doctoral researchers at ETH Zurich.

References

[1] United Nations’ externe SeiteClimate Summit on Sept. 23

[2] The results are published externe Seitehere

[3] Bechtel and Scheve: externe SeiteWhat type of climate treaty would people around the world support 

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