Adaptation finance is designed to help vulnerable populations withstand effects of climate variability and change. However, levels of vulnerability seldom determine finance distribution. Political and economic preferences of national and local government decision- makers tend to direct funding streams. This article takes an institutional approach to adaptation finance allocation by comparing decentralized and devolved local governance structures managing adaptation finance in Kenya before and after the Constitution of 2010. Prior to reforms, funding was directed through decentralized mechanisms operating within district councils and local authorities; recently, devolution of political, administrative, and fiscal decision-making to county governments coincided with pilot- ing of new local adaptation funds. Theory suggests that devolution institutionalizes more participative decision-making and fairer allocations. Evidence suggests vulnerable communities are indeed more likely to access, design, and receive allocations of finance in devolved political systems.
The objective of adaptation finance is to assist vulnerable populations experiencing climate hazards to change behavior and support strategies to manage and lessen risk. In sub-Saharan Africa, climate hazards primarily involve flooding, droughts, and storm events. Yet, disadvantageous socio-economic circumstances condition exposure and sensitivity of these localities to such adverse climate events. In particular, the high poverty rates, weak infrastructure, and insufficient agency of populations experiencing physical hazards are the main factors causing high climate risk. Adaptation finance improves the situation by eliciting risk-reducing behavioral changes, such as livelihood diversification, water management, climate-resilient cropping, and resilience to climate disasters.
Exactly who receives adaptation finance is highly contentious. Academic and policy researchers advocate that the vulnerable participate in decision-making and receive a fair share of funding relative to those with low climate risk. Yet, research suggests allocation decisions are made according to absorptive capacity, cost-effectiveness, or even emissions reductions – factors often inversely related to climate vulnerability.