Who’s Responsible for Climate Change? New Evidence Based on Country-level Estimates of Climate Debt

In this paper we discuss the concept of climate debt, which measures the cumulative economic damages due to CO2 emissions. We find that the climate debt (estimated for 131 countries) is extremely large, equaling some $59 trillion over the 1959–2018 period. Climate debt is also substantial relative to other government liabilities; in the G-20, it equals about 81 percent of GDP. Looking forward to 2035, cumulative climate debt will rise another $80 trillion. Among the biggest emitters, climate debt per capita is the highest in the United States and 6 times as high as that of China (and 25 times as high as that of India). Recent pledges to reduce emissions (such as those in countries’ Nationally Determined Contributions, or NDCs) would still leave the advanced economies with high levels of climate debt per capita relative to the developing world. Reducing emissions to meet the Paris targets needed to limit temperature increases would more significantly reduce climate debt but would be difficult to attain in a fair manner. Given the fiscal pressures countries face from high levels of debt and rising age-related spending, countries could turn to greater taxation of energy with carbon taxes to help reduce climate debt.