Thirty years ago, half the developing world lived in extreme poverty— today, a quarter. 1 Now, a much smaller share of children are malnourished and at risk of early death. And access to modern infrastructure is much more widespread. Critical to the progress: rapid economic growth driven by technological innovation and institutional reform, particularly in today’s middle-income countries, where per capita incomes have doubled. Yet the needs remain enormous, with the number of hungry people having passed the billion mark this year for the first time in history. 2 With so many still in poverty

international expertise on economics, as well as finance, geography, the environment, international development and political economy to establish a world-leading centre for policyrelevant research, teaching and training in climate change and the environment. It is funded by the Grantham Foundation for the Protection of the Environment, which also funds the Grantham Institute for Climate Change at Imperial College London. More information about the Grantham Research Institute can be found at: www.lse.ac.uk/grantham Centre for Climate Change

Developed countries must take the lead in combating climate change. But mitigation will be neither effective nor efficient without abatement efforts in developing countries. Those are two key messages of earlier chapters. But there is a critical third dimension to meeting the climate challenge: equity. An equitable approach to limiting global emissions of greenhouse gases has to recognize that developing countries have legitimate development needs, that their development may be jeopardized by climate change, and that they have contributed little, historically, to the problem.

Many policies to address adaptation and mitigation are already known. Secure property rights, energy-efficient technologies, market-based eco-taxes and tradable permits—all have been piloted and studied over decades. But implementing them still proves difficult. Their success relies not just on new finance and new technology but also on complex and context-specific social, economic, and political factors normally called institutions—the formal and informal rules affecting policy design, implementation, and outcomes. 1 Values, norms, and organizational

innovative, rigorous research. The Centre is funded by the UK Economic and Social Research Council and has five inter-linked research programmes: 1. Developing climate science and economics 2. Climate change governance for a new global deal 3. Adaptation to climate change and human development 4. Governments, markets and climate change mitigation 5. The Munich Re Programme- Evaluating the economics of climate risks and opportunities in the insurance sector More information about the Centre for Climate Change Economics and Policy can be