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Essay from the year 2007 in the subject Business economics - Economic Policy, , course: Harvard College China-India Development and Relations Symposium, New York 03-04/2007, language: English, abstract: One of the major vindications for the US not signing Kyoto is that the treaty does not contain any legallybinding emission reduction targets for China and India, although these countries have become respectivelythe second and fifth biggest emitter of CO2. India and China -in return- claim that a path of developmentthat would not harm the climate is too expensive for them; the West has to pay for a historicalresponsibility that stems from its past emissions, which brought about anthropogenic climate change in thefirst place. In this way the blame is passed from one nation to the other, and in the meantime all threecountries keep on increasing their gross emissions. The essay identifies that part of the problem is thecurrent perspective in intergovernmental emission reduction negotiation. All negotiation is about how muchthe global top-polluters agree to reduce their emissions. Kyoto left open to what value of CO2-equivalentcountries ultimately have to reduce their emissions. Thus it was also not possible to tell how much Indiaand China can increase their emissions. The essay rationalises how the exclusiveness of a top-downnegotiation increases the cost of climate change mitigation in the US, as in China and India, by constrictingthe US-suggestion of international CO2-emission trading to the inflexible Clean Development Mechanism.It describes how China and India could be integrated into emissions trading by setting a definite limit toeach country's emissions of CO2-equivalent. Here John Rawl's Original Position is used to identify that thisvalue should be found on a per-capita basis. The essay follows on to analyse the effect that the introductionof such a huge new market would have on the Sino-Indian region compared to the West, and additionallyhow it could alter the economic relationships between China and India. The essay then presents two ideason how the cost of this trading scheme would be divided between economically more developed countriesand less economically developed countries, in order to improve the political feasibility of the concept.Finally, the essay explains how linking each nation's gross amount of emission permits to the populationsize at a base year could give a strong economic incentive towards all countries world-wide to lower theirpopulations.