Emissions Rights and their Transferability: Equity Concerns over Climate Change Mitigation

Existing literature on equity considerations for climate change mitigation has largely focused on fair burden-sharing at an inter-national level without adequate attention to equity concerns at the intra-national level. However, disparities between regions and income groups within nations pose perhaps more equity concerns over climate change mitigation than those between nations. While international equity can be agreed upon via political negotiation among nations, the poor in both developed and developing countries may not be guaranteed their fair allocation of emissions rights because the necessary institutional framework has yet to be established at both international and national levels. This paper distinguishes three parts of emissions rights and discusses their transferability in view of equity concerns. The author suggests that basic necessity emissions rights are not transferable and non-necessity emissions are fully marketable, while individual contributions to state are subject to collective decision-making or political manipulation at the international level. The exact share of each of the three parts is subject to further investigation, but unlimited free trading of emissions rights is likely to result in equity concerns at both inter- and intra-national levels. Further examination in quantitative terms would represent an interesting case study for a better understanding of the issue.