Publication: Will Markets Direct Investments under the Kyoto Protocol?
Date
2007-02
ISSN
Published
2007-02
Author(s)
Abstract
Under the Kyoto Protocol, countries can
meet treaty obligations by investing in projects that reduce
or sequester greenhouse gases elsewhere. Prior to
ratification, treaty participants agreed to launch
country-based pilot projects, referred to collectively as
Activities Implemented Jointly (AIJ), to test novel aspects
of the project-related provisions. Relying on a 10-year
history of projects, the authors investigate the
determinants of AIJ investment. Their findings suggest that
national political objectives and possibly deeper cultural
ties influenced project selection. This characterization
differs from the market-based assumptions that underlie
well-known estimates of cost-savings related to the
Protocol's flexibility mechanisms. The authors conclude
that if approaches developed under the AIJ programs to
approve projects are retained, benefits from Kyoto's
flexibility provisions will be less than those widely anticipated.
Citation
“Larson, Donald F.; Breustedt, Gunnar. 2007. Will Markets Direct Investments under the Kyoto Protocol?. Policy Research Working Paper; No. 4131. © World Bank, Washington, DC. http://openknowledge.worldbank.org/entities/publication/46e8fdbb-f46c-5b5e-a8fd-5fa9915b0755 License: CC BY 3.0 IGO.”
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