Fairness issues in emission permits allocation for climate policies: a study in experimental ethics

This paper analyses a range of fairness issues raised by the initial allocation of tradable carbon emission permits. The key objective is to enlight to what extend the allocation of GHGs emission permits may or should be used for income redistribution. For that purpose, the paper presents and analyses the main results of a quasi-experimental approach of the ethical preferences of the agents when they are faced with various mechanisms for allocating carbon emission permits. Since countries differ in regard to demographic or economic development viewpoints, they may have very different adaptation capacities. The Kyoto Protocol states that climate policies have to take into account “common but differentiated responsibility” of the countries, for this reason a special attention is given to the postwelfarist approach of ethical issues which demands an explicit account of responsibility considerations in resource allocation. In order to identify the parameters that should be taken into account in the allocation process, the ETES (Equal Transfer for Equal S) axiom is tested on four variables: population, GDP per capita, marginal abatement cost, and initial level of carbon emission. The quasi-experiment shows evidence of a hierarchy among these variables and that the degree of compensation should vary among situations