Trade for Climate Justice?- A normative study on the possible justice conflict of an implementation of border carbon adjustments between developed and developing countries.

Abstract: Border carbon adjustment is an economic instrument being discussed more frequently as a possible solution to address carbon leakage, which is an issue for many developed countries. Developed countries are showing interest in this instrument to protect domestic industries from carbon leakage to countries that do not tax carbon. There is however concerns from developing countries that border carbon adjustments are protectionist and will have a negative effect on their economies. This paper studies the concept of border carbon adjustments from a justice point of view to determine if it can be considered to be a fair instrument in relation to developing countries. Three different principles and general discussions of justice within the case of climate change are used to determine the fairness of this instrument. The conclusion of the paper is that border carbon adjustments are in their current form not a fair instrument to implement on developing countries, as they will have a negative effect on their welfare and since developed countries are responsible for a greater proportion of historical emissions. Further research should focus on the design of border carbon adjustments to achieve a fairer design of border carbon without jeopardizing the welfare of developing countries.