MODERATING EFFECTS OF TRADE, GOVERNANCE, AND INSTITUTIONS ON CARBON FINANCE AND GREEN TRADE FOR CLIMATE JUSTICE

Abstract

Climate justice, integrating environmental sustainability with social and economic equity, has become a central concern for global policy, particularly in the context of climate finance and green trade interventions. Despite increasing implementation of these policies, limited research has empirically examined how trade diversification, governance quality, and institutional capacity moderate their effectiveness. This study constructs a Composite Climate Justice Index (CJI) integrating emissions reduction, economic vulnerability, and social equity indicators for 78 countries from 2010 to 2022. Using panel regression models with interaction terms, the analysis demonstrates that higher governance quality, diversified trade networks, and stronger institutional capacity amplify the positive impacts of carbon finance and green trade policies on climate justice outcomes. Findings provide actionable insights for policymakers to design context-sensitive and integrated climate interventions, particularly in vulnerable regions of the Global South.