Advancing Equity in International Climate Finance: New Approaches to Informal Institutions and Power

Abstract

The negative impacts of climate change are particularly damaging for communities in low- and middle-income countries that have fewer resources available for adaptation. High-income countries have pledged $100 billion annually to support efforts to mitigate climate change and cope with its impacts. Grounded in principles of equity and restitution, international climate finance has tremendous potential to enable adaptation among the most vulnerable. Concern is growing, however, that international support for adaptation is not reaching those communities that need it most. Recent studies have shown that many international interventions fail to recognize the social and political underpinnings of climate vulnerability and can actually make inequality worse. Many have pointed to informal and entrenched systems of unequal power, such as clientelism and patrimonialism, as key obstacles to more equitable adaptation. Such informal institutions – unwritten codes and conventions that shape behavior – have long been seen by international actors as obstacles to equality. This dissertation explores the issue of informal power in climate finance, particularly how informal institutions shape equity in internationally financed adaptation. It is comprised of three separate analyses, each of which examines informal power at a different scale: global, national, and sub-national. At the global scale (Chapter 2), I examine the overall architecture of climate finance, focusing on the ways in which it differs from development aid. I find that climate finance is grounded in new principles of restitution, country ownership, and the use of climate specific criteria in decision-making. As a result, I argue, spaces are emerging within this architecture for experimentation and risk-taking with new approaches to informal institutions in countries receiving international funding. Chapters 3 and 4 empirically investigate how informal institutions of clientelism and patrimonialism shape the equity of international adaptation projects targeted at the particularly vulnerable in Mauritius and Madagascar. Drawing on 105 interviews at the national level (Chapter 2), I find that government decision-makers in both countries directed project benefits through informal channels and used project resources as part of broader efforts to build political power. While outcomes in Mauritius were relatively equitable, outcomes were highly inequitable in Madagascar. I argue that these divergent outcomes can be explained by characteristics of each country’s institutional environment. At the sub-national level in Madagascar (Chapter 4), I investigate the distributional outcomes of the same adaptation project in its primary intervention sites. I test the hypothesis that households’ connections to the patronage structure of the state influenced access to project benefits. Analyzing 599 household surveys, I find that project benefits are strongly associated with household political connectivity. I further argue that access was influenced not only by connections to state patronage, but also the uneven movement of information and knowledge through informal community networks. These findings illustrate how informal power can influence internationally financed adaptation. New approaches are needed to ensure equity, especially in targeting funding to socially disadvantaged and politically marginalized groups. This dissertation therefore focuses on identifying opportunities and approaches to advance equity within current frameworks. In particular, I argue for focusing on equitable outcomes as much as inequitable ones. Taken together, the new spaces for experimentation within the overall architecture of climate finance can combine with new approaches on ground to not only make adaption more equitable but also contribute to broader efforts to transform inequitable systems long-term.