Climate Change and Global Development

The increasing concern with climate change is one of the main issues of our time, and thus we aim to theoretically and mathematically analyse its causes. However our approach follows a different stream of thought, presenting the reasoning and decision-making processes between technical and moral solutions. We have resorted to game theory models in order to demonstrate cooperative and non-cooperative scenarios, ranging from the traditional to the evolutionary within game theory. In doing so we are able to glimpse the development of modern society and a paradigm shift regarding human control over nature and to what extent it is harmful to the sustainability of our environment and the survival of future generations. Merging different fields of knowledge, we present a theoretical-philosophical approach, combined with empirical-mathematical solutions taking into account the agent-based behaviour guided blindly by instrumental rationality.

Climate change is one of the most challenging and threatening uncertainties of our days, impacting mankind with a continuously growing intensity. In our chapter, we rise an alert flag and provide evidence of the nonexistence of a dominant or consensual approach to correctly account for the interconnectedness between the decision-making process by economic agents and the environmental damages that affect them. Our survey analyzes a series of distinct contemporary contributions on the subject, trying to create awareness on the state of art in the agent-based modeling applied to climate change. We analyze the macroeconomics of the environment from an agent-based perspective, outline directions for future developments, and identify several domains that lack more intensive attention from the academic community. We conclude that public policies aimed at preventing climate catastrophes must take into account patterns of sentiment spreading, allowing for the potential economic benefits of mitigation of environmental change-related impacts.

Climate change poses the serious challenge of greenhouse gas emissions reduction with much concern over carbon dioxide (CO2) which is the main component of overall greenhouse gas emissions. Emissions control by developing countries is becoming a key for effective mitigation of climate change, as these countries now account for more than a half of global emissions and are still expanding their energy infrastructures. One solution to this is by reducing greenhouse gas emissions to achieve the target of mitigating global warming. However, reducing CO2 emissions means decreasing a country’s industrial production, and it is likely to decrease gross domestic product (GDP) growth, employment, etc. In other words, achieving a higher growth will induce more emissions of CO2 thus deepening the climate crisis with disturbing long-run consequences, both economically and socially. Therefore, how to effectively control greenhouse gas emissions especially the emissions of CO2 and to achieve a sustainable economic growth at the same time is a serious problem in policy-makings. Although a large amount of academic researches have been devoted to climate change, the overall climate change effect to growth is not conclusive for developed and developing countries. Previous studies suggest that there is a linear effect of climate change to growth, neglecting the non-linearity issue between climate change and growth. Through this present study, we address the issue of the existence of threshold effects in the relationship between climate change and growth rate of GDP in the context of global data, using new endogenous panel threshold autoregressive (TAR) model. Our main interest is to provide answer to the question whether climate change can affect long-run economic growth. With threshold regression models, we find that the effect of climate change on growth varies with the level of GDP per capita. In assessing the effect of greenhouse gas emissions to GDP growth, double threshold effect and three regimes are discovered. The assessment of the effect of CO2 emissions to GDP growth has detected single threshold indicating only two regimes exist.

It is well-established that climate change can be the result of human activities that create greenhouse gas emissions, which causes the greenhouse effect and further lead to the net effect of global warming. As far as the effects of climate change to human health and outputs of economic sectors are concerned, we can expect there will be negative impacts on output and employment. The objective of this study is to investigate the climate change effects to industrial output and employment in the context of ASEAN, by focusing on six emerging economies, namely, Cambodia, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam for the period of 1989–2016. We use temperature and precipitation as the proxies for climate change. We apply the bounds testing procedure proposed by Pesaran et al. (Journal of Applied Econometrics 16:289–326, 2001) to analyse the cointegration relationship and the autoregressive distributed lag (ARDL) modelling approach of Pesaran and Shin (An autoregressive distributed lag modeling approach to cointegration analysis. In: Strom S (ed) Econometrics and economic theory in the 20th century: the Ragnar Frisch centennial symposium. Cambridge University Press, Cambridge, 1999) and Pesaran et al. (Journal of Applied Econometrics 16:289–326, 2001) for the long-run and short-run relationships between industrial output and employment with the climate change variables. We found long-run relationship between climate change, industrial output and employment in all the countries analysed, except for the industrial output in Vietnam. Further, the long-run and short-run results show some similarities and variations. Our findings allow us to suggest different policy implications for long run and short run based on our results.

In its Article 6, the Paris Agreement foresees international cooperation and tasks it with mitigating greenhouse gas emissions, guaranteeing environmental integrity and assuring sustainable development. In its paragraphs, the same article provides for three different systems of international cooperation. The so-called market mechanisms or carbon markets could play a role in two of them.

Article 6 makes it apparent that international cooperation and the use of markets are valid—but not exclusive—approaches in reconciling climate change and (sustainable) economic development. The question is how to align both through the operationalization of market systems. This paper provides first an overview of “carbon markets” within the body of the Paris Agreement. Then, it discusses why and how carbon markets reconcile climate change-related action with (sustainable) economic development. Third and lastly, the paper points at some safeguards in the operationalization of the international cooperation using markets as stipulated in Article 6 of the Paris Agreement. The most important safeguard regards to accounting principles.

Democracy, economic development and even statehood itself are all less than secure in the Balkans, a region with a history of conflict. Now, as the countries of the region (Serbia, Bosnia-Herzegovina, Macedonia, Albania, Montenegro and Kosovo) strive for individual and collective stability, they face the additional challenges brought by climate change and do so against a background of weak or recovering economies with limited budgets for addressing issues of environmental protection, insufficient environmental regulation or implementation, limited public participation and political tensions. Looking to the current legal and institutional framework on climate change in this group of countries, we try to identify the main obstacles to climate change policy and to access what has been the EU role at this level. We defend that although the several challenges that these states still must address on, such as corruption and weak governance, the EU accession process has been the main political driver of change in the region, providing opportunities for improving the environment in different ways. Using the comparative method, we argue that there is a correlation between institutional capacity and implementation of environmental laws and that governance aspects have a strong effect on environmental actions and outcomes.

Since 2008, the countries of the group known as the BRIC countries (Brazil, Russia, India and China) have acted as strategic partners with a twofold purpose: to change the architecture of international relations and to rearrange the balance of powers to soft balance world’s largest military power, the United States. Countries that are today classified as ‘growing economies’ are undoubtedly the highest global consumers of energy, emitting polluting agents such as those from natural gas, oil and coal, which are all responsible for the greenhouse effect. The present chapter analyzes and examines whether, within the international context, the BRICS have sought to respect the United Nations Framework Convention on Climate Change (1992) (that is, the Doha Amendment to the Kyoto Protocol), and to establish new commitments for the period 2013–2020 under the Paris Agreement (2016). To that end, we note important political and economic aspects of the BRICS that converge—and sometimes diverge—as member countries pursue the climate change agenda, and we look at how these same aspects strengthen the decisions of the different governments of each BRICS. Of note in this examination is the role of the New Development Bank, known as the BRICS Bank, which is recognized as the driving force behind clean energy financing and for its contribution to sustainable development.

The Anthropocene poses profound challenges to the conservation of the Amazon rainforest, a global carbon reservoir. The forest’s unsustainable model of development, based on severe land use changes, and the effects of anthropogenic climate change may result in irreversible damage. In addition, crossing tipping points for the survival of the Amazon rainforest may trigger catastrophic climate change (CCC), which reflects the urgent need for a new development paradigm for the region. However, the prospects of the dieback of the Amazon as well as of a CCC scenario are generally overlooked in the academic and political debates. This chapter aims to fill this gap by exploring the link between irreversible environmental changes in the forest and potential CCC and by analyzing the challenge of sustainable development in the Brazilian Amazon, demonstrating how close a climate catastrophe might be; it then presents a novel development paradigm for the region. The revolutionary technologies of the Fourth Industrial Revolution are proposed as central to this necessary paradigm shift. Because the Amazon rainforest is a global natural asset for avoiding CCC, Brazil is also advised to follow a diplomatic plan that upholds fundamental ecological principles for creating a safe space for humanity, thus attracting international investments to manage and preserve the forest.

This chapter uses data on Intended Nationally Determined Contributions (INDCs) to examine the nature of climate change mitigation and adaptation actions being pursued in African countries and assesses the extent to which preferred mitigation and adaptation priorities advance the cause of sustainable development on the continent. The prospective synergies between mitigation and adaptation approaches and sustainable development are assessed. Also, the pathways through which resource constraints and institutional and policy environment affect Africa’s ability to mitigate and adapt to climate change are examined, as well as the degree to which these constraints are being addressed. It is argued that Africa’s ability to benefit from sustainable development synergies embedded in the mitigation and adaptation strategies in the INDCs will be greatly limited by institutional and policy environment that hinders funding, capacity building, and technological innovation systems development. The slow pace of efforts to address these impediments further erodes confidence that climate adaptation in Africa will be effective at sufficiently contributing to a reduction in climate change risks to the continent.

The purpose of this paper is to compare the environmental performance of two internal combustion engine vehicles (ICEVs) with distinct engines, one with the conventional diesel engine and the other with an electric motor supply (hybrid diesel) and a diesel engine, and then to assess which one has less environmental impact. The Portuguese automobile park was chosen for this study. The purpose of the comparison of the two researched ICEVs is that they show many similarities in terms of features by having the same type of body and varying only in the power-train system. The life-cycle assessment (LCA) methodology is performed by utilizing one ICEV with 170 kW. In both ICEVs the direct environmental impact is evaluated through a quantitative analysis, and a comparison is made with the purpose to assess the ICEV with the best environmental performance. The inputs and outputs data were collected from different sources and treated by the software OpenLCA for each life-cycle stage. The results have shown that the hybrid ICEV has revealed to have generally a better environmental performance compared to the diesel ICEV.

“Don’t buy this Jacket” is the advertising campaign of the clothing brand Patagonia asking customers not to buy its products. In this marketing campaign, the company requested customers to wrest the full life out of every Patagonia product by buying used when possible and asking customers to reduce unnecessary consumption. “Baked before sunrise; donated after sunset” is the marketing campaign developed by the bakery company Panera. This company donates all the leftover bread after stores have shut down, and the unsold bread goes toward a great cause, reducing food waste, which is the cause of huge wastage of natural resources.

There is no doubt that globalization and technology have in recent years been responsible for the economic and social progress of the four corners of the world. Tourism has also been “affected” by these phenomena and is generally referred to as the greatest expression of globalization. Today, the business volume of tourism equals or even surpasses that of oil exports, food products or automobiles. Tourism has become one of the major players in international commerce and represents at the same time one of the main income sources for many developing countries. This growth goes hand in hand with an increasing diversification and competition among destinations (UNWTO). In the service area, tourism distinguishes itself as the main industry for technological use and innovation. But as tourism grows, climate risks increase. Storms, hurricanes, torrents of water, earthquakes and general natural disasters arrive without warning!

Madeira Island was no exception; after the storm of 2010, which left marks still visible today, the island once again suffered a fire of unprecedented dimensions in August 2016, terrorizing the population and tourists who quickly helped spread the news around the world. The strong winds and very high temperatures far above normal pushed the flames to the city, populated by old buildings and badly treated pieces of land that worked as a fuse to make the city a hell of flames. The initial under-assessment of risk and clear lack of preparation for such events helped, and chaos settled for several days. The economic impact of the fires, the damage to the local entrepreneurs and the recovery of the destination image are something that can take years to recover. This chapter intends to deepen the damage caused to the island tourism sector while suggesting some actions that can minimize the effect of a similar crisis in events that seem to arise more and more frequently!

A broad lesson from this book is the recognition that climate change is a global phenomenon, which should be accounted for in a multidisciplinary perspective. In fact, it is impossible to deal with climate change and promote its mitigation without taking into account the agents’ choices and priorities in different countries and regions. Those choices determine the politics followed by decision-makers at every opportunity (through elections in democracies) and iterations between countries (and eventually have an effect on the well-being of populations) that should take into account the income level, the income distribution, and the health status of populations. Thus, the interplay between politics, international relations, and economics becomes a stage for the analysis made in the different chapters of this book. Additionally, climate change mitigation is crucially dependent on technological change, as is the economic development of societies.