2 Knight defined uncertainties as either risks accessible using objective historical data or uncertainty where there is little or no data and the underlying processes are not well understood. The exposition here updates his original taxonomy to include more recent thinking on a fuller range of degrees of uncertainties.

3 It is possible for the cost curves to be very flat in certain regions, however, and technological change can shift them down significantly over time.

4 In principle these ancillary benefits should be credited only to the extent of the cost of direct control of those pollutants they obviate.

5 This is an extensive and diverse literature, of which a few examples are Ramakrishna (1992), Shue (1993, 1995), Mintzer and Leonard (1994), Munasinghe (1994, 1995, 2000), Lipietz (1995), Parikh (1995), Rowlands (1995), Runnalls (1995), Jamieson (1996, 2000), Murthy et al. (1997), Parikh et al. (1997), Rajan (1997), Sagar and Kandlikar (1997), Schelling (1997), Byrne et al. (1998), Najam and Sagar (1998), Parikh and Parikh (1998), Tolba (1998), Agarwal et al. (2000).

6 The average per capita energy consumption of low income households in developing countries is frequently only about 10% of that of the upper-middle income groups in these countries, a pattern that parallels the 1:10 ratio of per capita energy consumption between developing and developed countries (see Siddiqui, 1995).

7 Although this issue received attention in the IPCC SAR (IPCC, 1996), the discussion was framed in technical terms, namely the determination of the appropriate discount rate, which made little accommodation for philosophical, legal, and sociological perspectives on intergenerational rights and responsibilities.

8 The reason for this paradox is that at the global level intercountry distributional impacts dominate over the within-country impacts (see World Bank, 2000, p. 51).

9 See, e.g., de Bruyn et al. (1998) and Opschoor (1997), who develop this idea from a development perspective, and Hoffert et al. (1998) who uses the “Kaya Identity” to formulate decompositions from an energy economics perspective.

10 This possibility is also corroborated by time-series data on carbon intensity, which reveal evidence of “de-coupling” of the strong relation in some countries, including developing countries. However, the change has not been significant enough to reverse the overall trends towards increasing emissions.

11 Much of the discussion on equity invokes global commons as an organizing concept, especially with regard to the conflict between individual (or corporate) use and global community interests. This is a well-worn theme in the literature on collective action, dating back to Hardin (1968), who saw unchecked population growth as the main problem. For a recent and more nuanced view, see Ostrom (2000).

12 In the literature cited by Rayner et al. (1999) see, in particular, Grubb (1995), Burtraw and Toman (1992), and Chichilnisky and Heal (1994). For a theoretical framework on accident liability, see Calabrese (1970).

13 This group has been referred to in the literature as the “ecological refugees” (Gadgil and Guha, 1995), the “vagabonds” (Bauman, 1998), the “castaways” (Latouche, 1993), and the “excluded” (Korten, 1995). However, some writers have raised concerns that these groups impact climate change (as well as biodiversity) adversely through non-sustainable land-use practices and deforestation.

14 However, current trends suggest that mitigation has already begun in some non-Annex I countries, even in the absence of deliberate climate policy. Reductions on fossil fuel subsidies (as a percentage of existing subsidies) have been larger in developing countries (especially China) than in OECD countries, and are leading to considerable savings in carbon emissions (International Energy Agency, 1996; Johnson et al., 1996; Reid and Goldemberg, 1997).

15 However, defenders of the CDM argue that the current options will disappear if not exploited immediately (for the “low-hanging fruit” will rot if not picked early), and that the early exploitation will transfer technology, capacity, and resources to developing countries and enable them to access the more expensive options later (see Haites and Aslam, 2000).

16 For example, several authors have commented on the initiation of attempts at Kyoto to incorporate developing countries within an emissions control mandate as a retreat from the foundational principles of the UNFCCC (Cooper, 1998; Jacoby et al., 1998; Schmalensee, 1998). These attempts include the call for the adoption of voluntary emissions control targets by non-Annex 1 countries (UNFCCC, 1997a).

17 These innovations have also yielded alternative indices of welfare, including the human development index (HDI; see UNDP, 1989), basic human needs (BHN; see Streeten et al., 1981), the physical quality of life index (PQLI; see Morris, 1979), and others.

18 “Social capital” is generally taken to mean the network of social relationships, collective social capacities, and institutions (Banuri et al., 1994; Clague, 1997).

19 In the absence of detailed data that would (or, indeed, could) allow the aggregation of the different components of the capital stock into a single index, the only option is to pay attention to each component separately. The “four capitals” approach has remained largely a conceptual device rather than an operational one, even though it has often been applied at a project level to ensure that all the necessary components are accounted for.

20 “Capacity” is different from “capital”, although the two are related. The latter implies the availability of income-generating capacity alone, while the former suggests the freedom to make policy choices or to achieve social goals.

21 Indeed, some analysts argue that the poor constitute a distinct “livelihood” economy, which is not well integrated into the global trading and financial system, and therefore lacks the flexibility to respond to emerging market opportunities or standard economic policies (Korten, 1990, 1995).

22 EIA, Energy Outlook. These scenarios do not account for the impact of the recent agreements in Kyoto to curb emissions. The differences in trends in Annex I and non-Annex I are similar in other baseline scenarios. Chapter 2 discusses the range of possible scenarios and criteria for selection.

23 While in the previous section on the equity perspective the emphasis is on an equitable distribution of greenhouse gas emissions while taking into account sustainability criteria, in this section on global sustainability the focus is on the implications of an eventual decrease of global per capita emissions taking into account equity criteria.

24 In post-industrial economies, in particular, the resource intensity of GDP is declining.

25 Most of this literature contains assessments of the economic potential of single technologies as well. For some more detail, see Chapter 3 of this report.

26 For a more detailed discussion of the so-called rebound effect, see the special issue of Energy Policy, 28 (2000), 355–495.

27 This would lower the demand for capital equipment and allow larger scale more efficient equipment to be used, which in turn would lower resource use and GHG emissions.

28 Participants in international research programme are mostly scientific experts and do not have expertise in development, equity, or sustainability issues.