Breaking the impasse: towards a new regime for international climate governance

The reality of the current international order makes it imperative that a just and effective climate regime balance the historical responsibility of developed countries with the increasing absolute emissions from many developing nations. In this short outlook article, key pillars are proposed for a new international climate architecture that envisions replacing the current annex system with two new annexes –Annex α, for countries with high current emissions and historically high emissions, and Annex β, for countries with high current emissions and historically low emissions. Countries in both annexes would implement legally binding targets under this framework. Additionally, this proposal includes tweaks and revisions to funding and technology transfer mechanisms to correct for weaknesses and inequities under the current Kyoto architecture. The proposed framework stems from a belief that a top-down, international approach to climate policy remains the most effective for ensuring environmental integrity. Given the slow rate of institutional learning, reforming and improving the current system is held as a more efficient course of action than abandoning the progress already achieved. It is argued that the proposed framework effectively accommodates key equity, environmental integrity and political feasibility concerns.

Testing for non-linearity in daily sterling exchange rates

A number of tests for non-linear dependence in time series are presented and implemented on a set of 10 daily sterling exchange rates covering the entire post Bretton-Woods era until the present day. Irrefutable evidence of non-linearity is shown in many of the series, but most of this dependence can apparently be explained by reference to the GARCH family of models. It is suggested that the literature in this area has reached an impasse, with the presence of ARCH effects clearly demonstrated in a large number of papers, but with the tests for non-linearity which are currently available being unable to classify any additional non-linear structure.