Climate and equity: a framework to understand welfare impacts and guide policy action

Reducing the impact of climate change on poor and vulnerable households is essential for hastening poverty reduction. In thinking about policies that do this, it is useful to apply the same hazard, exposure, and vulnerability framework that is often used to understand the physical impacts of climate change and add the non-climate benefits and costs to households that these policies can also bring. Policies that reduce hazards and/or vulnerability while bringing non-climate benefits should be prioritized where possible. However, some development policies that bring non-climate benefits, particularly in higher-income and higher growth countries, may increase emissions by enough to worsen future hazards, so their emissions impact needs to be managed with compensating actions. Policies that reduce the hazards faced by poor households are needed, and the non-climate cost of these policies on poor people should be minimized or compensated where it cannot be avoided.