Abstract
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The concept of justice and being “fair” is often heavily debated. More so, when it comes to the international negotiations on the mitigation of climate change. A peep into the charter of UN Framework Convention on Climate Change highlights the importance of distributive fairness or in other words, equity. The concepts of “equal per capita CO2 emissions”, “polluter-pays principle”, etc. in some way provides different perspectives on the issue of equity. For long, the economics literature has been focussing on the efficient allocation of optimum levels of the provision of some common resources among different associated parties. But strangely, less attention has been given to the equity aspects of such allocations. For example, developing countries as well as environmental interest groups in industrialized countries claim that developed countries with high per capita greenhouse gas emissions are responsible for global warming and must take the lead in combating climate change. In consequence, weaker obligations for developing countries may be based on equity arguments.
In this backdrop, out of the existing equity criteria, i.e. egalitarian rule, sovereignty rule, polluter-pays rule, ability-to-pay rule, the first objective is to quantify the significance of these equity principles across two major power houses in the world at present, India and the European Union (based on 2014-15 (actual)) in terminal years of 2021-22 and 2031-32 for the future. To assess the distributions implied by the egalitarian, sovereignty, polluter-pays, and ability-to-pay rules, the paper makes use of the trends in the respective countries’ or groups of countries’ population data, baseline carbon emissions, and GDP. Based on a projection based empirical set-up, the author tries to model the carbon emissions policy, vis – a – vis, two sets of scenarios, the BAU Scenario (Business as Usual) and the Accelerated Scenario (i.e. with a 20 per cent CO2 emissions reduction). The main objective of trying out such an exercise is to predict the decision-making authority’s future choice of equity principle after weighing the benefits and costs arising out of such equity principles.The results indicate that in the long run the polluter-pays principle becomes comparatively insignificant. However, when it comes to the CO2 emissions abatement, as already existing in the literature, the support for egalitarian principle comes from the developed countries. Furthermore, the novelty of the contribution lies in the formulation of a convex combination of all the four principles to see the relative effectiveness of such equity principles across the two selected countries.
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