Institutions, Climate Change, and the Foundations of Long-Term Policymaking

Abstract

Many policy problems require taking costly action today for future benefits. Examining the case of climate change, this paper examines how two institutions—electoral rules and interest group intermediation—structure the distributional politics of climate change and as a result, drive variation in climate “policy investments” across the high-income democracies. Proportional electoral rules increase electoral safety, allowing politicians to impose short-term costs on voters. Concertation between industry and the state enables governments to compensate losers, defusing organized opposition to policy change. Moreover, the joint presence of both institutions generates complementarities that reinforce their independent effects, pushing countries onto different climate politics trajectories. Newly available data on climate policy stringency provide empirical support for the arguments. Countries with PR and interest group concertation have the highest levels of policy stringency and distribute higher costs toward consumers. The analysis points to causal mechanisms that should structure policy responses to a more general set of long-term challenges.