The risk of carbon leakage in global climate agreements

• DOI: 10.1007/s10784-020-09507-2
• Publication Date: 2020-09-16T23:36:07Z
• Authors: Tobias Nielsen; Nicolai Baumert; Astrid Kander; Magnus Jiborn; Viktoras Kulionis
• Keywords: Carbon leakage; Carbon offset; Leakage (economics)

Abstract Although climate change and international trade are interdependent, policy-makers often address the two topics separately. This may inhibit progress at intersection of could present a serious constraint for global action. One key risk is carbon leakage through emission outsourcing, i.e. reductions in emissions countries with rigorous policies being offset by increased less stringent policies. We first analyze Paris Agreement’s nationally determined contributions (NDC) investigate how addressed. find that insufficiently accounted these documents. Then, we apply novel quantitative approach (Jiborn et al., 2018; Baumert 2019) to trends outsourcing related previous regime—the Kyoto Protocol—in order assess whether reported were past. Our results 2000–2014 show more nuanced picture during Protocol than studies have reported. Carbon from developed developing was dominated USA China, while evidence other mixed. Against conventional wisdom, that, general, stayed committed their targets either only minor outsourcers or actually even insourcers—although trend slightly negative—indicating binding do not necessarily lead outsourcing. argue multiple monitoring approaches needed reduce leakage.