The multi-faceted global poverty and income inequality landscape in a decarbonizing world

As nations ratchet up their climate change mitigation goals, associated social concerns regarding poverty and inequality must be considered in policy design and implementation. However, multi-faceted impact assessments of global climate change mitigation embodying regional and sectoral details remain largely deficient. The study focuses on increasing the sectoral resolution of the assessment on climate change mitigation impacts on poverty and income inequality. Countermeasures to alleviate adverse distributional effects are evaluated through two integrated assessment models. The aim is to steer policy formulation toward a sustainable and equitable trajectory for climate change mitigation. Results show that, without careful design, stringent climate policies can increase income and food poverty as well as income inequality, especially in India and Sub-Saharan Africa. Although an equal-per-capita redistribution of domestic carbon revenues offsets adverse distributional impacts, it may not suffice to eradicate poverty or food poverty, especially in many Sub-Saharan African countries.