According to most metrics, economic inequalities across the world have been declining since the late 1980s.
This has been driven by decreasing inequalities between countries – due to rapid economic growth in Asia – and has occurred despite increasing inequalities within a number of countries.
However, this trend could be reversed by the impacts of climate change.
While the repercussions of a warming climate are being felt in all corners of the world, the scale of these impacts on different countries, regions, communities and individuals varies hugely. The degree of economic inequality in the future will largely depend on how well different groups can adapt.
In a new review study, published in Environmental Research Letters, we analysed the existing literature and gathered evidence on whether, where and how climate change exacerbates economic inequality.
We find robust evidence that climate change impacts do indeed increase economic inequality and disproportionately affect the poor – both globally and within countries on all continents.
Climate change increases inequalities locally and globally
Our review covers 127 peer-reviewed studies into climate change and inequality.
These research papers cover a wide range of geographies, climate impacts, types of economic inequality measured (such as income disparities, differences in consumption or welfare disparities), methods used (such as econometric models or surveys) and findings.
The vast majority of studies confirm that climate change is exacerbating economic inequalities or hitting the poorest the hardest. This finding holds true across regions, types of physical impacts, sectors, types of inequalities and assessment methods. It is particularly prominent in studies that compare the impact of climate change across countries.
There are only two studies that find that climate change reduces inequality, but they focus on specific local circumstances – that is, flooding in Pakistan or price disparities among fishers and traders in Mexico.
Similarly, four papers find that the wealthy – whether households or countries – are more affected by climate change than the poor. However, these instances are exceptions and mostly limited to specific circumstances. For example, one study shows that the tropical cyclone Bulbul in Bangladesh caused higher losses for richer shrimp farmers, because they had larger farms.
The chart below summarises these overarching results across the 127 studies, categorised by the percentage of studies showing a negative (red), positive (blue) or mixed (yellow) impact on inequality. Orange indicates a finding that does not fit one of the categories, while grey shows studies that could not reach a conclusion.
The different bars represent the geographical focus of the different studies. Most of the studies we reviewed either look at the global picture (46) or focus on individual countries (44).
When it comes to global studies, the consensus is that climate change is widening inequalities or affecting the poor the most, with around 78% of the papers reaching this conclusion.
Some studies also highlight other groups being disproportionately impacted by climate change, such as rural communities, urban populations, women or specific regions and sectors.
However, there’s a minority of papers that remain inconclusive about both the impact of climate change on inequalities and which groups are most affected.
When it comes to national studies, the trend remains consistent: around 68% of these papers find that climate change is driving up economic inequality or hitting the poorest the hardest (30 out of 44 papers).
As the map below shows, this holds true in all parts of the world. The purple shading indicates the number of studies finding a negative climate impact on inequality for each country.
The countries with the highest number of studies (more than five) showing that climate change increases economic inequality or disproportionately affects the poor are China, Brazil, Ethiopia and the US.
Different climate impacts contribute to inequality
Looking at the breakdown of studies, we found that the percentage of papers pinpointing a particular climate impact as exacerbating inequality or affecting the poor more significantly ranges from 60% for changes in rainfall to 89% for sea level rise.
You can see this in the left-hand chart below, which shows the findings of the literature review separated by climate impact. The right-hand chart shows the findings separated by sector. The categories are the same as in the earlier chart.
A majority of studies focus on the impact of rising temperature, with 72% of these concluding that temperature changes worsen economic inequality or affect the poor the most.
Most of the studies that find a reduction in inequality concern extreme weather events. This is often because these studies assess the impact on physical assets, which are predominantly owned by the wealthiest.
There are several channels through which biophysical climate change impacts translate into economic effects. These channels include broad economic effects that influence all sectors, changes in agricultural revenues due to factors such as crop yield declines, impacts on labour productivity, changes to infrastructure and physical assets, shifts in energy demand or water availability.
We found that studies identifying labour productivity or energy as the main channel through which climate change affects economic inequalities overwhelmingly conclude that inequalities increase or that the poor are more impacted.
A decline in labour productivity may indeed increase inequality if it disproportionately affects low-skilled workers, especially those who work outdoors or in non-air-conditioned environments.
Notably, a large proportion of the studies where physical assets are identified as the main channel suggest that inequality actually decreases due to climate change or that the wealthy suffer more. This is because rich individuals tend to face greater losses due to the higher value of their property.
Tackling climate impacts on inequality
Our investigation into the impacts of climate change on economic inequality was motivated by the need to better understand the climate change impacts are distributed across the world. This provides the other side of the coin to the effects of mitigation policies on inequality, which are often more widely discussed.
The evidence strongly indicates that the impacts of a warming climate are regressive across countries. Tackling the impacts of climate change on economic inequality will demand substantial policy changes and financial resources.
At the national level, policymakers will need to ensure that adaptation finance and loss and damage compensation effectively reach low-income households to reduce their vulnerability and increase their resilience to climate change impacts.
The results of our review underscore the importance of policymakers integrating climate risk management strategies into the design of “climate-proof” social programmes in poor regions, which are crucial for achieving climate justice objectives.
Of course, other forms of inequality beyond economic inequality, such as gender inequality, are important and interact with climate change, but this is a topic for another review.
The post Guest post: How climate change could reverse gains in global inequality appeared first on Carbon Brief.
Guest post: How climate change could reverse gains in global inequality
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A formal petition to the U.S. government calls for sanctions on Chinese seafood imports as it highlights China’s loophole-ridden illegal shark fin trade.
For migrant workers trapped onboard Chinese distant water fishing fleets, cutting the fins off sharks as they writhe violently on rusted decks in the Indian Ocean isn’t accidental. It’s an intentional and lucrative act that marks the start of a bloody half-a-billion-dollar offshore supply chain, tacitly supported by Beijing yet covertly concealed from port inspectors globally.
New data on international climate finance for 2023 and 2024 suggests that wealthy countries are highly unlikely to have met their pledge to double funding for adaptation in developing nations to around $40 billion a year by 2025 amid cuts to their overseas aid budgets.
At the COP26 climate summit in Glasgow in 2021, all countries agreed to “urge” developed nations to at least double their funding for adaptation in developing countries from 2019 levels of around $20 billion by 2025. Funding for adaptation has lagged behind money to help reduce emissions and remains the dark spot even as the data showed overall climate finance rose to a record $136.7 billion in 2024.
A United Nations Environment Programme report warned last year that wealthy nations were likely to miss the adaptation finance target and the data released on Thursday by the Organisation for Economic Co-operation and Development (OECD) shows that in 2024 adaptation finance was just under $35 billion.
The OECD, an intergovernmental policy forum for wealthy countries, said the increase between 2022 and 2024 was “modest”, adding that meeting the doubling target would require “strong growth” of close to 20% in 2025.
More cuts likely
The OECD’s figures do not go up to 2025, but several nations announced cuts to climate finance last year. The most notable was the abandonment of US pledges to international climate funds by the new Trump administration but the UK, France, Germany and other wealthy European countries also pared back their contributions.
Joe Thwaites, international finance director at the Natural Resources Defense Council, said developed countries were “not on track” to meet the adaptation funding goal.
Power Shift Africa director Mohamed Adow said adaptation finance is needed to expand flood defences, drought-resistant crops, early warning systems and resilient health services as the world warms, bringing more extreme weather and rising seas. “When that money fails to arrive, people lose homes, harvests and livelihoods – and in the worst cases, their lives,” he warned.
Imane Saidi, a senior researcher at the North Africa-based Imal Initiative, called the $35 billion in adaptation finance in 2024 “a drop in the ocean”, considering that the United Nations estimates the annual adaptation needs of developing countries at between $215 billion and $387 billion.
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If confirmed, a failure to meet the goal is likely to further strain relations between developed and developing countries within the UN climate process. A previous pledge to provide $100 billion a year of total climate finance by 2020 was only met two years late, a failure labelled “dismal” by the UAE’s COP28 President Sultan Al Jaber and many other Global South diplomats.
Missing that goal would also raise doubts about donor governments’ commitment to meeting their new post-2025 adaptation finance goal. At COP30 last year, governments agreed to urge developed countries to triple adaptation finance – without defining the baseline – by 2035.
African and other developing countries have pointed to lack of funding as a key flaw in ongoing attempts to set indicators to measure progress on adapting to climate change.
Speaking to climate ministers from around the world in Copenhagen on Wednesday, Turkish COP31 President Murat Kurum stressed the importance of climate finance. “It is easy to say we support global climate action,” he said, “but promises must be kept.”
He said the COP31 Presidency will use the new Global Implementation Accelerator and recommendations in the Baku-to-Belem roadmap, published last year, to scale up climate finance – and will hold donors accountable for their collective finance goals.
He noted that developed countries should this year submit their first reports showing how they will deliver their “fair share” of the new broader finance goal set at COP29 in 2024, to deliver $300 billion a year in climate finance by 2035. They are due to report on this once every two years.
Broader climate finance
The OECD data shows that the overall amount of climate finance – including funding for emissions cuts – provided by developed countries grew fast in 2023 before declining in 2024. In contrast, the amount of private finance developed countries say they “mobilised” increased in both 2023 and 2024, pushing the top-line figure to a record high.
While the OECD does not say which countries provided what amounts, data from the ODI Global think-tank suggests that the 2024 cuts to bilateral climate finance were spread broadly among wealthy nations.
Thwaites of NRDC welcomed the fact that overall climate finance provided and mobilised by developed countries exceeded $130 billion in both 2023 and 2024. He said that this was “well above earlier projections” and “shows that when rich countries work together, they can over-achieve on climate finance goals”.
But Sehr Raheja, programme officer at the Delhi-based Centre for Science and Environment, said these figures are “modest” when set against the new $300-billion goal.
“While the headline total figure of climate finance remains alright,” she said, “declining bilateral climate spending raises important questions about the predictability of high-quality, concessional public finance, which has consistently been a key demand of the Global South.”
She also lamented that loans continue to dominate public climate finance and that mobilised private finance is concentrated in middle-income countries and on emissions-reduction measures rather than adaptation projects. “Private capital continues to follow bankability rather than climate vulnerability or need,” she added.
Ritu Bharadwaj, climate finance and resilience researcher at the International Institute for Environment and Development, said the figures painted an outdated picture as climate finance has since declined as rich countries shrink their overseas aid budgets and increase spending on defence.
Last month, the OECD published figures showing that international aid – which includes climate finance – fell by nearly a quarter in 2025. The US was responsible for three-quarters of this decline. The OECD projects a further decline in 2026.
With Thursday’s climate finance report, the OECD is “publishing a victory lap for 2023 and 2024 at almost the same moment its own aid statistics show the funding base eroding underneath it,” Bharadwaj said.
The post New data shows rich nations likely missed 2025 goal to double adaptation finance appeared first on Climate Home News.
New data shows rich nations likely missed 2025 goal to double adaptation finance
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