Stranded nations? Transition risks and opportunities towards a clean economy

Andres, Pia ORCID: 0000-0001-9061-7538, Mealy, Penny, Handler, Nils and Fankhauser, Samuel ORCID: 0000-0003-2100-7888 (2023) Stranded nations? Transition risks and opportunities towards a clean economy. Environmental Research Letters, 18 (4). ISSN 1748-9326

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Abstract

The transition away from a fossil-fuel powered economy towards a cleaner production system will create winners and losers in the global trade system. We compile a list of ‘brown’ traded products whose use is highly likely to decline if the world is to mitigate climate change, and explore which countries are most at risk of seeing their productive capabilities ‘stranded’. Using methods from economic geography and complexity, we develop novel measures of transition risk that capture the extent to which countries’ export profiles are locked-in to brown products. We show that countries exporting a high number of brown products, especially technologically sophisticated ones, could find it relatively easy to transition. Conversely, countries with exports highly concentrated in a few, low-complexity brown products have much fewer nearby diversification opportunities. Our results suggest that export complexity and diversity play a key role in determining transition risk. Path-breaking diversification strategies are needed to prevent nations from becoming stranded.

Item Type:	Article
Official URL:	https://iopscience.iop.org/journal/1748-9326
Additional Information:	© 2023 The Author(s).
Divisions:	Geography & Environment Grantham Research Institute
Subjects:	G Geography. Anthropology. Recreation > G Geography (General) H Social Sciences > HB Economic Theory G Geography. Anthropology. Recreation > GE Environmental Sciences
JEL classification:	Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q50 - General
Date Deposited:	10 Mar 2023 14:33
Last Modified:	25 Apr 2024 17:09
URI:	http://eprints.lse.ac.uk/id/eprint/118378

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