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Left Behind by Design? Climate Vulnerability and Institutional Barriers in Global Environment Facility Financing

Bolander, Johanna LU (2026) EKHS42 20261
Department of Economic History
Abstract
This paper examines whether Global Environment Facility (GEF) financing systematically disadvantages climate-vulnerable and low-capacity countries, and whether this operates through GEF's own grant allocation or co-financiers' independent decisions. By using 3,581 single-country GEF projects approved between 1996 and 2026, it estimates OLS regressions examining how governance quality and climate vulnerability predict GEF grant size and co-financing separately. Co-financing correlates to higher Government Effectiveness and Regulatory Quality, while grant allocation is negatively associated with Control of Corruption, Rule of Law, and Political Stability. This suggests that the two channels respond to different governance signals. A... (More)
This paper examines whether Global Environment Facility (GEF) financing systematically disadvantages climate-vulnerable and low-capacity countries, and whether this operates through GEF's own grant allocation or co-financiers' independent decisions. By using 3,581 single-country GEF projects approved between 1996 and 2026, it estimates OLS regressions examining how governance quality and climate vulnerability predict GEF grant size and co-financing separately. Co-financing correlates to higher Government Effectiveness and Regulatory Quality, while grant allocation is negatively associated with Control of Corruption, Rule of Law, and Political Stability. This suggests that the two channels respond to different governance signals. A vulnerability penalty is identified across both outcomes but is consistently larger for grants, implying that GEF's own allocation disadvantages vulnerable countries at least as much as external co-financiers. Social readiness predicts co-financing but not grants, while economic readiness shows the opposite pattern, suggesting that the two channels impose different institutional barriers on recipient countries. (Less)
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author
Bolander, Johanna LU
supervisor
organization
course
EKHS42 20261
year
type
H1 - Master's Degree (One Year)
subject
keywords
Climate Finance, Co-Financing, Global Environment Facility, Governance Quality, Climate Vulnerability
language
English
id
9231457
date added to LUP
2026-09-07 13:58:50
date last changed
2026-09-07 13:58:50
@misc{9231457,
  abstract     = {{This paper examines whether Global Environment Facility (GEF) financing systematically disadvantages climate-vulnerable and low-capacity countries, and whether this operates through GEF's own grant allocation or co-financiers' independent decisions. By using 3,581 single-country GEF projects approved between 1996 and 2026, it estimates OLS regressions examining how governance quality and climate vulnerability predict GEF grant size and co-financing separately. Co-financing correlates to higher Government Effectiveness and Regulatory Quality, while grant allocation is negatively associated with Control of Corruption, Rule of Law, and Political Stability. This suggests that the two channels respond to different governance signals. A vulnerability penalty is identified across both outcomes but is consistently larger for grants, implying that GEF's own allocation disadvantages vulnerable countries at least as much as external co-financiers. Social readiness predicts co-financing but not grants, while economic readiness shows the opposite pattern, suggesting that the two channels impose different institutional barriers on recipient countries.}},
  author       = {{Bolander, Johanna}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Left Behind by Design? Climate Vulnerability and Institutional Barriers in Global Environment Facility Financing}},
  year         = {{2026}},
}