De-Carbonizing Economic Development in Sub-Saharan Africa (DeCaDe)

Apl. Prof. Dr. Jann Lay
2018 - 2021
BMBF Funding Priority "Economics of Climate Change"
Cooperation partners

Dr. Jan Steckel , Mercator Research Insitute on Global Commons and Climate Change (MCC), leading institution, Germany

Prof. Dr. Jörg Peters, RWI - Leibniz Institute for Economic Research, Germany



Research Questions

In recent years global emission increases have mainly been driven by developing countries’ economic growth, predominantly in Asia. Countries of Sub-Saharan Africa (SSA) could drive the next wave of carbonization, with energy demand being projected to increase sharply in the coming decades. The Paris Agreement emphasizes the intertwined relationship between climate impacts as well as emission reductions and sustainable development. A key question for developing countries is therefore how to forego carbon-intensive development steps.

The project aims to investigate carbonization dynamics and climate policy options in SSA. More specifically, feasible short term entry points for SSA countries will be analyzed to embark on low-carbon development paths and prevent lock-ins in long-lived infrastructure. Here, the project will deal with the political feasibility and the interrelationship of climate measures with other objectives, such as poverty reduction and employment. The team aims to improve the understanding of the political and institutional drivers and barriers that shape Africa’s energy transition, conducting comparative case studies.

The focus of the GIGA research team will be on effects of (future) climate policy on households and firms.

Contribution to International Research

Results derived in DeCaDe can inform different stakeholders how to identify and address current challenges: First, African governments can learn how to improve their NDCs in the upcoming UNFCCC periodic review process; in particular, they will help to understand which policy instruments can be implemented, how this can be politically backed and how they can be made effective. Multilateral development banks, such as the World Bank or African Development Bank, and bilateral donors (e.g. BMZ) can use our results to identify key areas of future action. In addition, our results can also inform a broad range of policy makers how different – and potentially conflicting – goals in the agenda 2030 can be managed. Academically, we will partially step on empirically uncovered ground.

Research Design and Methods

The evaluation of distributional effects by energy price changes on households will rely mostly on ex-ante micro-simulations to determine how different income groups are likely to be affected by climate measures. In particular, the results will provide information on whether a climate policy can be expected to be progressive or regressive, i.e. whether it will put a proportionally higher cost burden on richer or poorer households. The distributional impacts can also be analyzed along other socio-economic characteristics, such as household size, location, education etc. Detailed evidence on this account can be valuable to policy-makers to anticipate which social groups might be most likely to resist climate policy.

The analysis of impacts of energy prices on firms will cover new empirical ground for Africa. We will examine the effects of energy prices on production, profits, and - if data allow - on the use of other factors, in particular labour.

DeCaDe at MCC

Research Team

Research Programme