No abstract

The lack of real progress at the Durban climate change conference in 2011postponing effective action until at least 2020-has many causes, one of which is the failure to address trade issues and in particular carbon leakage. This paper advances two arguments. First, it argues that the conventional view of Border Carbon Adjustments (BCAs) as a "dirty" trade barrier should be turned on its head. Rather, the absence of a carbon price comprises an implicit subsidy to dirtier production in non-regulated markets. Second, BCAs could act as a gamechanger when climate policy negotiations move at a glacial pace, if at all. Materially stronger progress could be achieved indirectly from the threat of unilateral trade policies. The paper shows how this could come about, using a simple political game theory model. The appropriate game form is one in which parties move unilaterally and sequentially, given the failure to agree on a common course of action, and are fully aware of the impacts of their actions. The paper shows that properly crafted BCAs could help reduce trade distortions, limit the competiveness effects, and help build a broader coalition of interests for more global actions.

Community Forest Management (CFM) devolves forest management to local communities to achieve conservation and human well-being goals. Yet, the evidence for CFM's impacts is mixed and difficult to interpret because of inadequate attention to rival explanations for the observed empirical patterns. In a national-scale analysis in Madagascar that carefully considers these rival explanations, we estimate CFM impacts on household living standards, as measured by per capita consumption expenditures. The estimated impact is positive, but small and not statistically different from zero. However, we can statistically reject substantial negative impacts (which others have suggested may exist). The estimated impacts vary conditional on household education and proximity to forests: they are more positive and statistically significant for households closer to forest and with more education. To help improve CFM design, scholars and practitioners should anticipate heterogeneity in CFM impacts and work to better characterize them, theoretically and empirically.

Environmental accounting, Exhaustible resources, Genuine saving, Social welfare, Q01, Q03,