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Limiting costs or correcting market failures? Finance ministries and frame alignment in UN climate finance negotiations

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  • Jakob Skovgaard

    (Lund University)

Abstract

Finance ministries are increasingly involved in UN climate finance negotiations, yet this development received very limited attention in the literature on climate finance or climate negotiations. It is not obvious from the literature on bureaucratic politics how these ministries will position themselves on climate finance: they may frame climate finance as expenditure to be limited or as an instrument for correcting the market failure of climate change. This paper investigates which frames have characterised the positions of finance ministries on key issues in the climate finance negotiations, and whether the use of a given frame corresponds to particular factors. Case studies of Denmark, India, Indonesia and the USA based on official documents and interviews show that the position of each finance ministry is generally consistent with one particular frame. The Indonesian and Danish finance ministries predominantly framed climate finance as a way of correcting a market failure. The Indian Ministry of Finance emphasised Common but Differentiated Responsibilities, which fits with the budget frame. The US Treasury’s position similarly fits with the budget frame while sharing elements of the market failure frame. Finance ministries that had the lead on climate finance were more likely follow the budget frame. The use of both frames cuts across the divide between industrialised and emerging economies. With the exception of the USA, left- and right-wing governments were equally likely to adopt either frame. These findings indicate that strengthening finance ministry forums built around the market failure frame can be a way of reducing norm fragmentation.

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  • Jakob Skovgaard, 2017. "Limiting costs or correcting market failures? Finance ministries and frame alignment in UN climate finance negotiations," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 17(1), pages 89-106, February.
    • Handle: RePEc:spr:ieaple:v:17:y:2017:i:1:d:10.1007_s10784-016-9348-3
    DOI: 10.1007/s10784-016-9348-3
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    2. Peterson, Lauri & Skovgaard, Jakob, 2019. "Bureaucratic politics and the allocation of climate finance," World Development, Elsevier, vol. 117(C), pages 72-97.
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