Subnational Investments in Mitigation and Adaptation to Climate Change: Some Financing and Governance Issues

Abstract

Meeting climate change goals requires steadfast action at all levels of government in terms of both mitigation (measures to reduce greenhouse gas emissions) and adaptation (measures to reduce the impacts of climate change on economies and societies). Against this background, this paper discusses the role of subnational investment, including funding and financing options, as well as governance arrangements. It fills a gap in scholarly work on the principles guiding subnational investment in climate change mitigation and adaptation, identifies areas for future work, and underscores the need for cross-country comparable information on policy instruments and outcomes at the subnational levels of administration that could be used in more systematic hypothesis testing in this area. JEL classification codes: H11, H70, Q54.