The conventional narrative on climate-change negotiations has it that poor countries will invest in clean energy only if rich countries move first—or compensate them for the additional costs. And with rich countries stalling on their commitments, the global negotiations are at a stalemate.
New research by David Wheeler debunks this myth. Focusing on the power sector, Wheeler estimates energy growth and incremental costs for six low-carbon energy technologies (biomass, solar, wind, geothermal, hydro, and nuclear) in 174 countries from 1990 to 2008. He finds that developing countries on average have paid a fair share of their national income—about two-thirds of the share paid by rich countries during the past decade—and in some cases they are already paying much more.
Surprise: Poor Countries Are Shouldering the Costs of Combating Climate Change
The challenge now is not whether rich countries will lead the poor (it’s clear that they won’t) but whether the rich will match the expenditures that developing countries have already made, so that meaningful negotiations on climate change can proceed.
Data disclosure: The data and Stata programs associated with this work are available here.