Distributing scarce adaptation finance across SIDS: Effectiveness, not efficiency

Although Small Island Developing States (SIDS) receive high amounts of adapta- tion finance on a per capita basis, current and expected funding is much lower than present and future adaptation costs. Since funding is insufficient to cover all needs, adaptation finance ought to benefit those who are most entitled to the funding. These entitlements can be determined via prioritisation criteria. Vulnerability is the most prominent prioritisation criterion but must be supplemented with further criteria because of its shortcomings. In this contribution we thus investigate whether cost-effectiveness and democracy should play this role. To this end, we first discuss Stadelmann and colleagues’ proposal to operationalise the cost- effectiveness criterion via three indicators (absolute economic savings, relative economic savings, and avoided loss of Disability Adjusted Life Years). We argue that this set of indicators fails to capture important adaptation benefits and may reinforce the current bias towards hard adaptation measures. We further claim that one should ‘just’ focus on safeguarding effective, that is successful, adaptation instead. To that effect, we propose ‘democracy’ as an alternative to cost- effectiveness. We first justify the criterion by providing intrinsic and instrumental reasons in its defence and, second, discuss how to operationalise it, using the ex- ample of SIDS. We conclude that although also challenging, democracy is less difficult to operationalise than cost-effectiveness.