Within Reach: Navigating the Political Economy of Decarbonization
16 November 2023
Despite global commitments made through the Paris Agreement in 2015 to combat climate change, their translation into national policies has been slow, raising concerns about the feasibility of achieving climate targets. While policies face many obstacles, the political economy is one of the primary impediments to climate action, and urgency to reduce emissions makes slow and gradual approach increasingly insufficient. The report attempts to identify key political economy barriers and explore options to address them through the 4i Framework, considering how institutions, interests, ideas, and influence affect the political economy. The report offers a practical guide to help countries address political economy barriers when implementing climate policies with three prongs: (1) Climate Governance: governments can adapt their institutional framework, in ways that fit with the pre-existing political economy and moving from opportunistic and unstable to strategic and stable climate institutions. Establishing strategic climate governance institutions – such as climate change framework laws, long-term strategies, or just transition frameworks - can alter the political economy, set clear objectives, improve coordination across actors, and improve the ability to monitor progress and hold decisionmakers accountable. (2) Policy Sequencing: policies can be prioritized and sequenced based on dynamic efficiency, considering not only the economic costs and benefits, but also their feasibility and long-term impact on the political economy. The Climate Policy Feasibility Frontier tool can help identify policies that can overcome short-term political economy obstacles, and at the same time improve capacities and change the political economy to facilitate further climate action. (3) Policy Design and Engagement, considers the effective implementation of climate reforms by tactically navigating political economy constraints. This involves engaging citizens to create process legitimacy and reducing and managing distributional effects, not only across but also within income groups.
political economy transition distributional effects climate governance public engagement decarbonization climate policies institutional context macroeconomics and economic growth :: economic policy, institutions and governan environment :: environmental governance governance :: legislation public sector development :: climate change policy and regulation 4i framework