PolWe study the evolution of voter support for climate policies aimed at containing the effect of climate risk, as weather conditions worsens at a time of rising economic inequality. Households differ in age, beliefs and income, and the scale of intervention to preserve habitable land reflects the preference of the majority coalition. Economic polarization tightens conditions for more households, while rising climate risk increases support for public adaptation. If beliefs on attainable impact are not too dispersed, an initially coalition of young and old pessimists might tip towards a coalition of old optimists and young pessimists, leading to a jump in support for public action.A steady rise in inequality may ultimately induce a second political tipping point, towards a coalition of the low-income old and young pessimists, although the effects on public adaptation are weaker. Public intervention is undermined by pessimism about the efficacy of public adaptation and the "tragedy of the horizon" effect, as voters only partially internalize benefits for future generations. This prevents public adaptation from converging to the long-term social optimum even when political support is highest

van der Straten, Yasmine; Perotti, Enrico; van der Ploeg, Frederick (Rick)

PolWe study the evolution of voter support for climate policies aimed at containing the effect of climate risk, as weather conditions worsens at a time of rising economic inequality. Households differ in age, beliefs and income, and the scale of intervention to preserve habitable land reflects the preference of the majority coalition. Economic polarization tightens conditions for more households, while rising climate risk increases support for public adaptation. If beliefs on attainable impact are not too dispersed, an initially coalition of young and old pessimists might tip towards a coalition of old optimists and young pessimists, leading to a jump in support for public action.A steady rise in inequality may ultimately induce a second political tipping point, towards a coalition of the low-income old and young pessimists, although the effects on public adaptation are weaker. Public intervention is undermined by pessimism about the efficacy of public adaptation and the "tragedy of the horizon" effect, as voters only partially internalize benefits for future generations. This prevents public adaptation from converging to the long-term social optimum even when political support is highest

Yasmine van der Straten, Enrico Perotti and Frederick (Rick) van der Ploeg
Additional contact information
Yasmine van der Straten: University of Amsterdam

No 24-013/IV, Tinbergen Institute Discussion Papers from Tinbergen Institute

Keywords: Climate Change Adaptation; Economic Inequality; Tragedy of the Horizon; Political Tipping Points (search for similar items in EconPapers)
JEL-codes: D63 H23 Q54 Q58 (search for similar items in EconPapers)
Date: 2024-02-28
New Economics Papers: this item is included in nep-agr, nep-pol and nep-res
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