Market-based mechanism and ‘climate justice’: reframing the debate for a way forward

Manish Kumar Shrivastava () and Saradindu Bhaduri ()
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Manish Kumar Shrivastava: TERI School of Advanced Studies
Saradindu Bhaduri: Jawaharlal Nehru University University

International Environmental Agreements: Politics, Law and Economics, 2019, vol. 19, issue 4, No 9, 497-513

Abstract: Abstract The Paris Agreement on climate change recognizes, reluctantly albeit, the importance of ‘climate justice’ in its Preamble. Despite a change from a top-down burden-sharing approach to a bottom-up pledge and review regime, concerns of distributive justice remain central to the evolution of climate research, regime, and policy. The Paris Agreement also proposes a new market-based mechanism to promote ambition. Reasserting the unavoidability of ‘climate justice’ concerns, and responding to the suggestion that the proposed new market-based mechanism could learn from the experience of the Clean Development Mechanism (CDM), this paper argues that such a recommendation should be tested against a comprehensive understanding of compatibility between justice and the market. This paper postulates that both justice and the market have institutional underpinnings, which embed them into deeper, and interconnected, layers of values and relations. Arguing that ‘climate justice’ is best understood as ‘an agreed ensemble of values,’ we propose that the architecture of the UNFCCC in which these values are articulated, negotiated, and agreed upon needs to be conceptualized as consisting of four distinct, but evolving, institutional spheres: ambition, obligations and entitlements, mechanisms, and deliberation. The approach is illustrated using the case of the CDM, and implications are suggested for the proposed market-based mechanism under the Paris Agreement. The paper argues that the concerns of ‘climate justice’ have multiple institutional dimensions, and the market-based mechanisms may contribute to realizing certain dimensions of ‘climate justice,’ while considerably subverting others. The extent of both outcomes depends greatly on the ‘agreed’ conception of justice, design of mechanisms, and capabilities of the participants. Our findings suggest a judicious combination of non-market mechanisms with the market-based mechanisms would better serve the desired goal.

Keywords: Justice; Market-based approaches; Institutions; CDM; ITMOs; Paris Agreement (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1007/s10784-019-09448-5

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