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on Energy Economics |
| By: | J. Andrés; J.E. Boscá; A. Di Gennaro; R. Doménech; J. Ferri |
| Abstract: | This paper analyzes the driving factors behind the business cycle dynamics of carbon emissions in the U.S. economy from 1975Q1 to 2023Q3. We first identify some key stylized facts regarding the correlation between carbon emissions and the different components of the Kaya decomposition, some of which exhibit a sharp change in sign around the trend reversal of the environmental Kuznets curve in the late 20th century. From the estimated distribution of shocks in a dynamic stochastic general equilibrium environmental model, we find that: (a) innovations in green energy production play a marginal role in U.S. emissions cycles; (b) barely 17 percent of total emissions cycles are explained by aggregate shocks like those to total factor productivity or household consumption, while the rest stem from innovations in the efficiency in production of brown energy (brown energy productivity shock) and emissions per unit of brown energy; (c) since 2000, brown energy shocks have positively affected (increased) emissions growth, while emissions technology shocks have negatively impacted emissions, particularly following a structural break around 2007; and (d) without these shocks, the U.S. would have experienced a negative emissions gap for over 40 years. Since 2007, emissions reduction has accelerated, leading to convergence of observed and counterfactual Kuznets curves at around $16, 000 per capita GDP. Our findings explain the intriguing negative correlation between emissions and the share of dirty energy observed over the past twenty years. They suggest a connection to innovations in shale oil and gas production, highlighting both the limited potential for emission reduction through advances in producing a "cleaner" brown energy mix, and the urgent need for a decisive shift to renewable energy to achieve long-term climate goals. |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:fda:fdaddt:2025-04 |
| By: | Karl Dunkle Werner; Arik Levinson |
| Abstract: | Many governments and businesses would like to minimize or eliminate the greenhouse gases that result from their purchases of power from electricity grids. Because electricity flows cannot be traced from purchasers back to specific generators, some regulators and users have proposed an approximation. Purchasers would be credited with using clean power if they contract for electricity generated by particular zero-carbon suppliers to the grid or purchase certificates accompanying that zero-carbon generation, so long as those arrangements meet three conditions, or “pillars”: The associated clean power must be generated (1) nearby, (2) during the same hour, and (3) from newly constructed power plants. Whether or not the three pillars are followed, existing or planned electricity generation meeting all three conditions is expected to account for 10 percent of US power in 2030. We show that the qualifying power would be cleaner than average, but not zero-carbon. Electricity purchases meeting the restrictions will have incremental emissions per megawatt hour 30 to 43 percent below unrestricted average emissions per megawatt hour. The three pillars could have additional climate benefits if demand for clean power exceeds the restricted supply, resulting in less total electricity demand or encouraging construction of new clean electricity capacity. |
| JEL: | Q42 Q47 Q48 Q58 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33546 |
| By: | Vaska Atta-Darkua (University of Virginia, Darden School of Business); Simon Glossner (Board of Governors of the Federal Reserve System); Philipp Krueger (University of Geneva - Geneva Finance Research Institute (GFRI); Swiss Finance Institute; European Corporate Governance Institute (ECGI); University of Geneva - Geneva School of Economics and Management); Pedro Matos (University of Virginia - Darden School of Business; European Corporate Governance Institute (ECGI)) |
| Abstract: | We study how institutional investors that join climate-related investor initiatives decarbonize their equity portfolios. Decarbonization can be achieved either by re-weighting portfolios towards lower carbon emitting firms or alternatively via targeted engagements with portfolio companies to reduce their emissions. Our findings indicate that portfolio re-weighting is the predominant greening strategy by climate-conscious investors, in particular by those based in countries with carbon emissions pricing schemes. We do not uncover much evidence of engagement even after the 2015 Paris Agreement. Furthermore, we find no evidence that climate-conscious investors allocate capital towards firms developing climate patents, but they do re-weight towards firms starting to generate green revenues. Overall, our analysis raises doubts about the effectiveness of investor-led initiatives in reducing corporate emissions and helping an all-economy transition to “green the planet”. |
| Keywords: | climate change, decarbonization, GHG emissions, sustainability, institutional investors, CDP, Climate Disclosure Project, Climate Action 100+ |
| JEL: | G15 G23 G30 M14 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2542 |
| By: | Maya Papineau (Department of Economics, Carleton University); Nicholas Rivers (Department of Economics, University of Ottawa); Kareman Yassin (Hitotsubashi Institute for Advanced Study) |
| Abstract: | Maintaining household welfare in the transition to a net zero economy is critical to the public acceptance of climate policy. A challenge in meeting this goal is our incomplete understanding of the distribution of household-level benefits from policies designed to reduce greenhouse gases in residential buildings. We provide new insights on key variables that contribute to household and social welfare by quantifying both the level and distribution of energy savings, bill savings, and rebates disbursed from Canada’s national energy efficiency retrofit program. Using a unique dataset consisting of electricity and natural gas consumption from all single-family homes in a Canadian city, we find that adopted retrofits reduce natural gas consumption for up to 10 years in the average participating house by about 20% and whole-envelope retrofits reduce natural gas consumption by 35%. However, these savings represent only about half of pre-retrofit predicted savings, and several recommended retrofits save zero energy. While energy bill savings exhibit a modest peak among some lower wealth properties, retrofit rebates were disbursed equally across the house wealth distribution. |
| Keywords: | Energy efficiency; Deep Retrofits; EnerGuide for Homes; Distributional Effects |
| Date: | 2024–10–10 |
| URL: | https://d.repec.org/n?u=RePEc:car:carecp:24-01 |
| By: | Ahmed, Bruktawit (Missouri University of Science and Technology); Fikru, Mahelet G (Missouri University of Science and Technology) |
| Abstract: | This study examines the impact of carbon capture and storage (CCS) on electricity prices, an essential aspect of decarbonization in the power sector. While prior research has analyzed CCS's economic feasibility and environmental implications, the direct effects on electricity prices remain largely unaddressed. This study employs a profit-maximization model within a Cournot oligopoly framework, integrating Monte Carlo simulations to evaluate how production costs, policy incentives, and energy demand influence the percentage of carbon captured by power generators and the resulting electricity prices. The analysis incorporates key factors such as carbon taxes, renewable energy, and CCS subsidies, production and abatement costs, and consumer preferences for greener energy. The findings suggest that when mixed-asset power generators optimize carbon abatement to maximize profits, the relationship between the percentage of carbon captured and electricity prices varies by energy source. Carbon capture can lower non-renewable electricity prices to a certain threshold, driven by net benefits from CCS subsidies and tax-saving effects. In contrast, the price of greener electricity sees a modest increase due to the net costs of shifting production from renewable to non-renewable assets. Despite this, renewable electricity remains the more cost-effective option for consumers. Additionally, the result from the Monte Carlo simulations reveals that policy parameters, particularly CCS subsidies, effectively incentivize carbon capture but may also shift production dynamics, leading to nuanced effects on electricity pricing. For example, the study shows that with mixed-asset power generation, the price of non-renewable electricity could be higher than greener electricity, where higher CCS subsidies could drive up renewable electricity prices while lowering non-renewable electricity prices. These findings have important implications for energy policymakers. While CCS adoption is essential for reducing emissions, its potential to impact electricity prices presents affordability concerns, especially in price-sensitive markets. These shifts in price signals could disrupt price stability, making it challenging to ensure equitable energy access. Therefore, policymakers must carefully balance CCS incentives with support for renewable energy to avoid unintended price distortions. Within a well-designed framework that assesses price impacts, policymakers could encourage a hybrid energy strategy that facilitates the transition to renewables while leveraging carbon capture as a bridging solution. In this regard, future studies should explore the long-term effects of CCS on electricity price volatility, further examining how different market structures, regulatory environments, and technological advancements can mitigate or exacerbate price fluctuations, ultimately contributing to more sustainable and equitable energy systems. Future research could also incorporate heterogeneous firm behavior and dynamic investment decisions to refine the understanding of CCS pricing effects further. |
| Date: | 2025–03–05 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:saqhf_v1 |
| By: | Sitzmann, Amelie (Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI)) |
| Abstract: | The expansion of heat pumps drives the electrification of the heating sector which is important to achieve Germany’s ambitious climate targets. This paper examines the impact of heat pumps in combination with thermal storage on the flexibility of the German electricity system in 2030, focusing on its market and grid impacts. A timely and spatially detailed electricity market and transmission grid model evaluates the impact of thermal storage. The results show that, overall, unlocking the flexibility of thermal storage consistently reduces total supply costs. However, while the flexibility provided by thermal storage supports the integration of RES and reduces supply costs in the dispatch, the use of flexibility increases grid violations and hence, redispatch measures. By further studying a model setup with locational marginal prices (LMPs), the analysis highlights regional differences in the value of flexibility, which is particularly high in northern Germany, where proximity to wind generation enhances the benefits of thermal storage. |
| Keywords: | Market Design; Electricity Markets; Nodal Pricing; Energy System Modeling; Renewable Energies; Heat Pumps; Thermal Storage; Flexibility |
| JEL: | C61 D47 D61 Q40 |
| Date: | 2025–04–29 |
| URL: | https://d.repec.org/n?u=RePEc:ris:ewikln:2025_003 |
| By: | Isaksen, Elisabeth T.; Johansen, Bjørn G. |
| Abstract: | Decarbonizing transportation requires a shift from conventional to zero-emission vehicles. We examine whether congestion pricing with electric vehicle (EV) exemptions accelerates this transition by encouraging a shift toward cleaner cars. To identify causal effects, we combine administrative data on car ownership with a triple-differences design that exploits household-level variation in policy exposure across metropolitan areas and work commutes. We find that higher rush hour charges for conventional vehicles significantly increase EV adoption, primarily through replacement rather than fleet expansion. However, responses vary by socioeconomic characteristics, with higher-income and well-educated households more likely to adopt EVs. Beyond car ownership, we document behavioral adjustments, including relocation to avoid tolls, re-routing around the cordon, and shifting travel timing. Overall, congestion pricing reduced traffic volumes and improved air quality. Our findings offer insights for designing equitable and effective transportation policies. |
| Keywords: | congestion pricing; electric vehicles; car ownership; transportation policy; traffic; air polution |
| JEL: | H23 R41 R48 Q58 Q52 Q55 |
| Date: | 2025–05–31 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127836 |
| By: | Zhang, Shaojun (Ohio State U); Shi, Zhan (Tsinghua U) |
| Abstract: | An influential view attributes the “greenium†—the cost-of-capital gap between carbon-intensive and greener firms—to climate risks and investor preferences. We challenge this by showing that oil shocks are pivotal: rising prices, driven by foreign supply or sector-specific demand shocks, reduce energy firms’ cost of capital by enhancing their growth opportunities, creating a divergence from other brown firms. This energy specific component explains 20% of greenium fluctuations, peaking at 50%. Reassessing events like the Paris Agreement suggests the impact of investor discipline weakens when oil’s role is considered. Overall, markets price climate risks less effectively than a |
| JEL: | G10 G12 G15 Q51 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:ecl:ohidic:2024-24 |
| By: | Johannes Klausmann (University of Virginia - Darden School of Business); Philipp Krueger (University of Geneva - Geneva Finance Research Institute (GFRI); Swiss Finance Institute; European Corporate Governance Institute (ECGI); University of Geneva - Geneva School of Economics and Management); Pedro Matos (University of Virginia - Darden School of Business; European Corporate Governance Institute (ECGI)) |
| Abstract: | We introduce a novel measure of revenues from green products and services for publicly listed firms worldwide that is not spanned by prior sustainability metrics used in the literature. We show that green revenues grew at an accelerated pace after the Paris Agreement. This growth has been driven by innovative US companies converting green patents into green revenues, as well as by firms with higher sustainability-focused institutional ownership before the Paris Agreement. Furthermore, we examine the stock returns of firms with green revenues and find modest evidence of a green alpha in the post-Paris period, primarily concentrated in US stocks. |
| Keywords: | green revenues, sustainability, climate change, climate finance, green impact, ESG |
| JEL: | G15 G18 G23 G30 Q55 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2540 |
| By: | Tatsuya Kato (Financial System and Bank Examination Department, Bank of Japan (E-mail: tatsuya.katou@boj.or.jp)); Koki Sawai (Associate Professor, Saitama University, Graduate School of Humanities and Social Sciences (E-mail: sawaik@mail.saitama-u.ac.jp)) |
| Abstract: | The Paris Agreement of 2015 set a goal of limiting the increase in the global average temperature to 1.5 to 2.0 degrees Celsius above pre-industrial levels. Subsequently, the Japanese government announced its policy to achieve carbon neutrality by 2050. To achieve carbon neutrality and decarbonization, carbon pricing is expected to be utilized to place a price on carbon and control emissions. This study summarizes the debate among standard-setting bodies regarding the accounting treatment of cap-and-trade schemes and the practices around emissions trading. It examines their rationale from the perspectives of decision usefulness and achievement of optimal emissions levels. In particular, the method that recognizes the obligation to return allowances at the allocation of allowances (Allocation Method) excels in terms of timeliness and faithful representation of information related to total emissions. However, if profit or loss volatility undermines the predictability of future profits, it is necessary to find ways to control volatility. On the other hand, the Allocation Method is reasonable from the perspective of achieving optimal emissions levels because reductions in total emissions result in reduced liabilities and the recognition of gains. In addition, based on empirical evidence of the relationship between emissions disclosures by firms and emissions, it can be concluded that the current disclosure system contributes to achieving optimal emissions levels. |
| Keywords: | Cap-and-Trade Emissions Trading Systems, Decision Usefulness, Real @Effects, Task Force on Climate-related Financial Disclosures (TCFD), Sustainability Disclosure Standards |
| JEL: | M41 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:ime:imedps:25-e-02 |
| By: | Joseph E. Aldy; Forest L. Reinhardt; Robert N. Stavins |
| Abstract: | There is growing recognition of the relative importance of anthropogenic emissions of methane as a contributor to global climate change. An important source of such emissions in some countries, including the United States, is the oil and gas (O&G) sector. This points to the importance of developing understanding of the marginal abatement cost functions for methane emissions reductions. Scholars have employed a diverse set of methodologies to estimate abatement costs, including engineering cost models, econometric analysis of natural gas markets, and statistical retrospective analysis of state-level regulation. We critically summarize these approaches and synthesize their results. We find significant potential for low-cost methane abatement in the O&G sector in the United States and elsewhere, although claims of widespread negative abatement cost opportunities should be taken with a grain of salt. We also find that the potential for low-cost abatement is not without limit. Whereas it appears that cutting methane emissions in half would be relatively inexpensive, a sharp uptick in marginal abatement cost may occur when reductions exceed 60 to 80 percent below baseline levels. This threshold may change over time with technological advances in remote sensing, which can reduce abatement costs at various levels of ambition. |
| JEL: | Q52 Q54 Q56 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33564 |
| By: | Adrien Bilal; James H. Stock |
| Abstract: | This paper surveys the literature that links macroeconomics and climate change. We organize our review into three categories: (i) loss and damage, which assesses long-run economic costs and non-market impacts from climate change; (ii) mitigation and the energy transition, which evaluates the macroeconomic consequences of shifting away from fossil fuels toward renewable energy; and (iii) adaptation, which explores the economic adjustments necessary to manage heat stress, more frequent severe weather events and rising seas. We discuss macroeconomic frameworks that quantify these structural shifts as well as empirical estimates that guide their calibration. We suggest areas in which macroeconomic research on climate is needed. |
| JEL: | E60 F55 H23 H41 Q43 Q50 R10 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33567 |
| By: | Krebs, Tom (University of Mannheim); Weber, Isabella (University of Massachusetts Amherst) |
| Abstract: | The structural theory of green transformation acknowledges the complexity of the transformation process and suggests a state-led approach with green industrial policy at its core. In contrast, the market-fundamentalist approach to the transformation problem relies on carbon pricing and the assumption of smooth adjustment to rising market prices. We argue that the recent energy crisis in Germany provides a test of market fundamentalism. We show that the behavior of key macroeconomic variables contradicts the market-fundamentalist theory of green transformation. We also detail how mainstream economists and the policy establishment held on to their belief in self-regulating markets despite the empirical failure of market fundamentalism, which led to policy mistakes with large economic and political costs. Policy making based on market fundamentalism caused substantial damage to Germany’s economy and helped the far-right Alternative for Germany (AfD) double its political support. |
| Keywords: | inflation, energy crisis, market fundamentalism, green industrial policy, green transformation, fiscal austerity, price controls. |
| JEL: | E12 E32 E64 L50 L60 Q43 Q48 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17834 |
| By: | Marie Young-Brun (Université Paris 1 Panthéon-Sorbonne, CNRS, Centre d'Economie de la Sorbonne, Paris School of Economics and IWH, University of Leipzig - Germany); Francis Dennig (Yale-NUS, World Bank - Italy); Frank Errickson (School of Public and International Affairs, Princeton University - USA); Simon Feindt (Mercator Research Institute on Global Commons and Climate Change (MCC) - Germany, Technische Universität Berlin, Economics of Climate Change - Germany, Potsdam Institute for Climate Impact Research, Potsdam - Germany); Aurélie Méjean (CIRED - CNRS, Centre International de Recherche sur l'Environnement et le Développement (CNRS, Agro Paris Tech, Ponts ParisTech, EHESS, CIRAD); Stéphane Zuber (Université Paris 1 Panthéon-Sorbonne, CNRS, Centre d'Economie de la Sorbonne, Paris School of Economics) |
| Abstract: | Climate change and global inequality are intertwined. First, from a cross-country perspective, poorer countries have less financial capacity to abate emissions and are more vulnerable to climate impacts. Second, within countries, climate damages and mitigation costs tend to fall disproportionately on poorer households, which has implications for the political feasibility of mitigation. Integrated Assessment Models used for global climate policy evaluation have so far typically not considered inequality effects within countries. To fill this gap, we develop a global Integrated Assessment Model representing national economies and sub-national income distribution, and assess a range of climate policy schemes with varying levels of effort sharing across countries and households. The schemes are consistent with limiting temperature increases to 2°C, and account for the possibility to use revenues from carbon pricing to address distributional effects within and between countries. Among these, we explore a "Loss and Damage" scheme, aiming to compensate vulnerable countries for unavoidable damages from climate change. A key finding is that relatively low levels of international transfers can result in sizable improvements in inequality and welfare, due to the impacts on the most vulnerable households within countries. If international transfers are not feasible, our results show that the greatest inequality reductions can be achieved through sub-national transfers and reallocation of abatement efforts across time and countries |
| Keywords: | Inequality; Climate policy; "Loss and Damage" |
| JEL: | H23 Q54 Q58 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:mse:cesdoc:25009 |
| By: | Nelli, Linnea (Università Cattolica del Sacro Cuore); Virgillito, Maria Enrica (Università Cattolica del Sacro Cuore); Vivarelli, Marco (Università Cattolica del Sacro Cuore) |
| Abstract: | The aim of this paper is to understand whether what has been labelled as “twin transition”, at first as a policy flagship, endogenously emerges as a new technological trajectory stemming by the convergence of the green and digital technologies. Embracing an evolutionary approach to technology, we first identify the set of relevant technologies defined as “green”, analyse their evolution in terms of dominant blocks within the green technologies and concurrences with digital technologies, drawing on 560, 720 granted patents by the US Patent Office from 1976 to 2024. Three dominant blocks emerge as relevant in defining the direction of innovative efforts, namely energy, transport and production processes. We assess the technological concentration of the dominant blocks and construct counterfactual scenarios. We hardly find evidence of patterns of actual endogenous convergence of green and digital technologies in the period under analysis. On the whole, for the time being, the “twin transition” appears to be just a policy flagship, rather than an actual endogenous technological trajectory driving structural change. |
| Keywords: | technological trajectories, policy flagship, twin transition |
| JEL: | O33 Q55 Q58 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17779 |
| By: | Angelos Alamanos; Giannis Arampatzidis; Stathis Devves; Kostas Dellis; Christopher Deranian; Olympia Nisiforou; Phoebe Koundouri; Jeffrey D Sachs |
| Abstract: | Achieving climate-neutrality is a global imperative that demands coordinated efforts from both science and robust policies supporting a smooth transition across multiple sectors. However, the interdisciplinary and complex science-to-policy nature of this effort makes it particularly challenging for several countries. Greece has set ambitious goals across different policies; however, their progress is often debated. For the first time, we simulated a scenario representing Greece's climate-neutrality goals drawing upon its main relevant energy, agricultural and water policies, and compared it with a 'current accounts' scenario by 2050. We follow a systems-nexus approach that encompasses the FABLE Calculator, the Low Emissions Analysis Platform (LEAP), the MaritimeGCH model, and the tools WaterReqGCH, LandReqCalcGCH and BiofuelGCH. The results indicate that most individual/sector policies have the potential to significantly reduce carbon emissions across all sectors of the economy (residential, industrial, transportation, services, agriculture, and energy production). However, their implementation seems to be based on economic and governance assumptions that often overlook sectoral interdependencies, infrastructure constraints, and social aspects, hindering progress towards a unified and more holistic sustainable transition. |
| Keywords: | Climate Neutrality, Energy-emissions modelling, LEAP, FABLE Calculator, MaritimeGCH, WaterReqGCH, Decarbonization, Greece |
| Date: | 2025–04–30 |
| URL: | https://d.repec.org/n?u=RePEc:aue:wpaper:2531 |
| By: | Julian di Giovanni; Galina Hale; Neel Lahiri; Anirban Sanyal |
| Abstract: | The slow adoption of climate change policies stems from concerns about their economic impact. The EU has led global carbon pricing through its Emissions Trading Scheme (ETS). This study examines the effect of ETS policy shocks on global stock market returns at the country-industry level using linear and spatial autoregression models. Results show that while markets react negatively to rising carbon prices, the impact is small in magnitude. Global spillovers are limited to sectors linked to EU industries via intermediate goods trade, with no significant effects beyond these supply chain linkages. Overall, the unintended consequences of EU climate policies appear negligible, with minimal effects on targeted industries’ stock returns and no spillovers outside supply chain linkages. |
| JEL: | F10 F18 F36 G15 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33647 |
| By: | Dechezlepretre, Antoine; Fabre, Adrien; Kruse, Tobias; Planterose, Bluebery; Sanchez Chico, Ana; Stantcheva, Stefanie |
| Abstract: | This paper explores global perceptions and understanding of climate change and policies, examining factors that influence support for climate action and the impact of different types of information. We conduct large-scale surveys with 40, 000 respondents from 20 countries, providing new international data on attitudes toward climate change and respondents’ socioeconomic backgrounds and lifestyles. We identify three key perceptions affecting policy support: perceived effectiveness of policies in reducing emissions, their impact on low-income households, and their effect on respondents’ households (self-interest). Educational videos clarifying policy mechanisms increase support for climate policies; those merely highlighting climate change’s impacts do not. |
| JEL: | C80 D83 D91 Q54 Q58 |
| Date: | 2025–04–30 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127870 |
| By: | Pollitt, M. G. |
| Abstract: | This paper explores the concept of scale within the future electricity sector. First, we discuss the theory and evidence behind economies of scale and scope and how they might apply to firm sizes within the electricity supply sector. Next, we consider how the governance of the electricity sector might influence firm scale. Finally, we explore how the nature of what is required to get to net zero might shape firm scales. Overall, we suggest that decentralisation trends within the electricity sector do not clearly imply that large firms will become less significant in a net zero electricity sector. |
| Keywords: | Scale, Scope, Governance, Net Zero, Decentralisation |
| JEL: | L94 |
| Date: | 2025–03–15 |
| URL: | https://d.repec.org/n?u=RePEc:cam:camdae:2513 |
| By: | Mats Kröger; Karsten Neuhoff; Sebastian Schwenen |
| Abstract: | We examine the impact of the war in Ukraine on long-term contracts in energy markets. We find that traded contract volumes fall by 65 percent in the first months of the war. A collapse in bilateral trading contributes most to this decline. To protect themselves from price shocks, firms increasingly turned to long-term contracts already before the war. In sum, our results show that the market continued to serve firms’ hedging needs during the crisis, but bilateral trading networks collapsed, and liquidity was largely provided by centralized markets. |
| Keywords: | Firm behavior, long-term contracts, forward markets, crisis, electricity |
| JEL: | D22 P48 G14 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2118 |
| By: | Lutz Sager |
| Abstract: | In 2013, China introduced the ambitious Air Pollution Prevention and Control Action Plan (APPCAP) targeting ambient fine particle (PM2.5) pollution. Using panel data covering 239 countries and territories worldwide, from 2000 to 2019, I provide quasi-experimental estimates of nationwide reductions in PM2.5 exposure achieved since 2013. I find that the APPCAP lowered PM2.5 exposure of the average Chinese resident in 2019 by over 20%, reducing PM2.5-related deaths by between 220 and 280 thousand depending on estimation strategy. Monetizing the mortality reductions with recent values of statistical life suggests total benefits of up to 1 trillion Renminbi or 1% of Gross Domestic Output. |
| Keywords: | air pollution, health, mortality, regulation. |
| JEL: | I18 Q52 Q53 Q58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11826 |
| By: | Qiaoyi Chen; Nicholas Ryan; Daniel Xu |
| Abstract: | We study carbon offsets sold by firms in China under the Clean Development Mechanism (CDM). We find that offset-selling firms, meant to cut carbon emissions, instead increase them by 49% after starting an offset project. In a model of firm investment decisions and offset review, we estimate that CDM firms increase emissions due to both the selection of higher-growth firms into projects (35 pp) and because offset projects themselves boost firm growth and therefore emissions (14 pp). The CDM reduces global surplus by causing damages from increased emissions four times greater than private gains from trade in the offset market. |
| JEL: | L51 O13 Q54 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33636 |
| By: | Alevtinowitch, Kleschev Anton |
| Abstract: | This paper presents MoonShine, an integrated 20-year roadmap to elevate humanity to a Type I Kardashev civilization by achieving ∼ 10’16 W of sustainable power. Key innovations include in-situ resource utilization (ISRU) on the Moon, fully automated self-replicating robotic factories with automatic repair capabilities to counteract space debris, hybrid laser-microwave power transmission, and an AI-governed control infrastructure. We detail technological modules, quantitative growth models (22% annual power expansion), economic scenarios, ecological safe- guards, and a new supranational governance framework: the Lunar-Earth Energy Alliance (LEEA). Risk analyses cover debris mitigation, climate feedback, geopolitical stability, and system resilience. We show that through synergy of current breakthroughs in materials science, AI, robotics, and energy conversion, the MoonShine project can deliver planetary energy sovereignty and climate management, setting the stage for Mars and beyond. |
| Date: | 2025–04–24 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:a9yuh_v1 |
| By: | Sarah Chung; Claudia Persico; Jing Liu |
| Abstract: | Recent empirical research shows that air pollution harms student test scores and attendance and increases office discipline referrals. However, the mechanism by which air pollution operates within schools to negatively affect student and teacher outcomes remains largely opaque. The existing literature has primarily focused on the effects of prolonged exposure to pollution on end-of-year test scores or total absence counts. We examine how ambient air pollution influences student-by-day and teacher-by-day outcomes, including absences and office discipline referrals, using daily administrative data from a large urban school district in California between 2003 and 2020. Using wind direction as an instrument for daily pollution exposure, we find that a 10 μg/m3 increase in daily PM2.5 causes a 5.7% increase in full-day student absences and a 28% increase in office referrals in a three-day window. Importantly, the effects are driven by low-income, Black, Hispanic, and younger students. In addition, over three days, a 10 μg/m3 increase in daily PM2.5 causes a 13.1% increase in teacher absences due to illness. Our research indicates that decreasing air pollution in urban areas could enhance both student and teacher attendance, and minimize disruptive behavior in educational settings. |
| JEL: | I14 I24 Q53 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33549 |
| By: | Cirilo Mendoza, Elibeth (University of Warwick) |
| Abstract: | The use of traditional biomass fuels such as wood and dung for cooking is a prevalent practice in low-income countries, leading to significant indoor air pollution and adverse health outcomes. Previous studies have found that the promotion of subsidized Liquefied Petroleum Gas (LPG) had a negative impact on health outcomes in Peru. This study revisits this evidence by leveraging the national FISE program, which provided discounted LPG to low-income households. Using a staggered difference-in-differences approach combined with district-level data from the Peruvian DHS from 2005 to 2020, this study evaluates the effects of the FISE program on infant mortality and respiratory health outcomes. The findings reveal that the program increased LPG adoption as a primary cooking fuel by 8% (or 2.8 pp). However, the evidence on the program’s impact on reducing infant mortality and acute respiratory infections remains inconclusive, highlighting the complexity of measuring health impacts in the context of energy transitions. JEL classifications: I15 ; O13 ; Q53 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:wrk:wrkesp:83 |
| By: | Eliseo Curcio |
| Abstract: | This study evaluates ethanol blending as a practical near-term strategy for significant transportation decarbonization in the United States. Despite rapid growth in electric vehicle adoption, gasoline is projected to remain dominant, with annual demand around 135 billion gallons by 2035, necessitating immediate complementary solutions. Analysis indicates ethanol use will notably expand, driven by regulatory incentives such as RFS Renewable Identification Numbers (RINs) and IRA tax credits (45V), leading to potential market penetration of E15 at about 25% and E85 also expanding substantially. Ethanol derived from waste achieves notably lower carbon intensity at approximately 58.34 gCO2e/MJ, substantially better than conventional gasoline (~92 gCO2e/MJ), providing clear environmental advantages. Economic assessments show robust investor returns and local economic growth driven by policy incentives, including Renewable Identification Numbers (RINs) and IRA tax credits (45V). Infrastructure analysis confirms manageable costs and feasible adjustments for widespread adoption of higher ethanol blends. |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2504.06278 |
| By: | Thomas Eichner; Marco Runkel |
| Abstract: | Within a two-country model, this paper identifies a novel emission leakage channel that is caused by moral behavior of (atomistic) consumers. In a non-cooperative emission tax game between the countries, the leakage effect lowers the governments’ marginal benefit of emission taxation, so equilibrium emission tax rates are even lower and the emission levels even higher than in the business-as-usual without moral consumers. The detrimental effect of consumer morality may remain, if governments behave morally, too, and may even be exacerbated under country asymmetries. It disappears, if governments choose emission caps, since the caps fix national emissions and avoid morality-induced leakage. |
| Keywords: | moral behaviour, emissions, tax, cap, leakage |
| JEL: | H23 H71 Q58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11698 |
| By: | Naudé, Wim (RWTH Aachen University) |
| Abstract: | This paper provides a primer on climate technology entrepreneurship, recognizing its limitations and potential adverse consequences. Climate technology entrepreneurship is needed to contribute to mitigation of and adaptation to climate change, and to help decouple economic growth from resource use. This paper identifies and describes three climate technology gaps: (i) an energy climate tech gap, an (ii) overshoot climate tech gap; and (iii) a resilience climate tech gap. The paper furthermore argues that policies for supporting climate technology entrepreneurship, including entrepreneurial ecosystems and mission-oriented approaches, have significant shortcomings. Furthermore, the paper concludes that Artificial Intelligence (AI) is unlikely to make a difference to the world’s climate change predicament. Hence, climate technology entrepreneurship is no panacea for climate change and ecological overshoot caused by human activity. On its own it will not save the world. |
| Keywords: | climate change, entrepreneurship, climate technology, sustainable development |
| JEL: | L26 Q54 O31 L53 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17794 |
| By: | David Jaggi (Zurich University of Applied Sciences; University of Zurich - Department of Finance); Markus Leippold (University of Zurich; Swiss Finance Institute); Tingyu Yu (University of Zurich - Department Finance) |
| Abstract: | This study presents ClimateControversyBERT, a novel open-source language model for real-time detection and classification of corporate climate controversies (i.e., brown projects, misinformation, ambiguous actions) from financial news. Validated using RepRisk and Refinitiv metrics, the model effectively identifies inconsistencies between corporate climate commitments and actions as they emerge. We document significant negative market reactions to these controversies: firms experience an immediate average stock price drop of 0.68%, with further declines over subsequent weeks. The impact is intensified by high media visibility and is notably stronger for firms with existing emission reduction commitments, underscoring the market's penalty for perceived environmental failures. |
| Keywords: | Climate controversy, corporate greenwashing, natural language processing |
| JEL: | G14 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2545 |
| By: | Marco Ceccarelli (VU University Amsterdam); Stefano Ramelli (University of St. Gallen - School of Finance; Swiss Finance Institute); Anna Vasileva (University of Zurich - Department of Finance); Alexander F. Wagner (University of Zurich - Department of Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swiss Finance Institute) |
| Abstract: | Does the political context shape investors’ non-pecuniary demand for green assets? We provide evidence from incentivized surveys of U.S. investors before and after the 2024 U.S. presidential election. After Trump’s victory, investors reduced green investments on average. However, investors who strongly disapprove of his climate policy increased their green investment taste. These “contrarians” placed greater weight on non-pecuniary considerations and less on financial ones, suggesting they view green investing as a way to compensate for perceived climate inaction. Empirical analyses of real-world ETF flows align with this interpretation. The findings have implications for understanding and modeling green investment behavior. |
| Keywords: | Beliefs, Climate change, Expected returns, Investments, Political economy, Surveys, Sustainable finance, Transition risk, Behavioral finance |
| JEL: | D83 G11 G12 G41 G51 P18 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2536 |
| By: | Scott A. Carson |
| Abstract: | Quad O is the Environmental Protection Agency (EPA)’s methane reduction regulation that requires greater producer efficiency when methane is extracted by requiring efficient upstream, midstream, and downstream equipment. There are various times when Quad O was implemented and updated, and August 11th, 2012 was the first implementation period. Quad O’s second implementation was on January 1st, 2015, and this study evaluates oil and gas returns around Quad O’s early 2015 regulatory change. Oil and gas returns were mostly unaffected by the second Quad O implementation, indicating it is difficult to identify when firm returns responded to regulatory change. Equity to commodity markets interacted for each firm’s return. Exploration & production equity to Brent crude ratios are among the lowest commodity market risk in the industry. In contrast, equity and commodity markets place the next highest equity to commodity ratios to mid and downstream transportation & pipeline and refining & marketing firms, indicating comparative commodity to equity risk was higher closer to oil and gas extraction. |
| Keywords: | environmental protection agency, regulation, quad-o, methane. |
| JEL: | L50 L51 L52 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11821 |
| By: | Fabio Alessandrini (University of Lausanne; Banque Cantonale Vaudoise); Eric Jondeau (University of Lausanne - Faculty of Business and Economics (HEC Lausanne); Swiss Finance Institute); Lou-Salomé Vallée (University of Lausanne - Faculty of Business and Economics (HEC Lausanne)) |
| Abstract: | This paper explores the integration of Nationally Determined Contributions (NDCs) into the construction of net-zero (NZ) portfolios of sovereign bonds. Based on both backward-looking (2015-2021) and forward-looking (2021-2030) analyses, we compare the effectiveness of scenarios using constant greenhouse gas (GHG) intensities and NDC-based trajectories in reducing the portfolio's GHG intensity while minimizing the tracking error relative to the business-as-usual benchmark. The backward-looking exercise reveals that NDC-based portfolios achieve similar GHG intensity reductions with lower tracking errors compared to constant-intensity scenarios, demonstrating their efficacy in building an NZ portfolio. Conversely, constant-intensity strategies require more aggressive rebalancing, leading to higher tracking errors and uneven allocations. In the forward-looking exercise, the more ambitious second round of NDCs announced before COP26 enables substantial GHG intensity reductions at a marginal financial cost. Overall, our results highlight the potential of NDCs as a forward-looking tool to align sovereign bond portfolios with climate objectives while maintaining financial performance. However, imposing weight restrictions by country or region, to ensure more equitable investment between advanced and emerging economies, significantly limits the ability to meet reduction targets and increases tracking errors. |
| Keywords: | Net-zero investment, Sovereign bond portfolio, Portfolio carbon footprint, Climate change, Nationally determined contributions |
| JEL: | G11 Q56 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2522 |
| By: | Alin Marius Andries (Alexandru Ioan Cuza University of Iasi; Romanian Academy - Institute for Economic Forecasting); Steven Ongena (University of Zurich - Department Finance; Swiss Finance Institute; KU Leuven; NTNU Business School; Centre for Economic Policy Research (CEPR)); Nicu Sprincean (Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iași; National Institute for Economic Research, Romanian Academy) |
| Abstract: | We examine the relationship between climate-related financial policies (CRFPs) and banks' systemic risk. Using a sample of 458 banks in 47 countries over the period 2000-2020, we document that more stringent CRFPs are detrimental to overall financial stability and contribute to increased system-wide distress. These findings raise the possibility that overly stringent green finance policies could lead to a disorderly transition. In addition, measures that restrict banks' exposure to carbon-intensive counterparties, both directly and indirectly, may lead to less lending to the real economy and higher lending rates. The latter increase, in turn, could lead to significant credit losses, reduced bank profitability and other spillover effects with the potential to undermine systemic resilience. However, the implementation and ratification of the Paris Agreement, more robust adaptation strategies to cope with climate shocks and a higher incidence of natural disasters and a larger number of people affected by extreme climate events may counteract the amplifying effects of CRFPs on systemic risk. Moreover, banks with stronger environmental, social, and governance (ESG) commitments experience less systemic distress when exposed to green financial policies. Our findings have critical policy implications for public authorities formulating green financial policies to achieve the goals of the Paris Agreement. |
| Keywords: | systemic risk, climate change, climate-related financial policy |
| JEL: | G21 G32 Q54 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2530 |
| By: | Könneke, Jule |
| Abstract: | Kernziele der neuen EU-Kommission sind es, die geoökonomische Widerstandsfähigkeit zu erhöhen, die Dekarbonisierung voranzutreiben und die Wettbewerbsfähigkeit zu steigern. Dafür ist die EU auf Schwellenländer wie Brasilien angewiesen. Doch während China sein Engagement in Brasilien ausgeweitet hat, verliert die EU an Einfluss, weil sie keine langfristige Strategie besitzt und nicht in der Lage ist, der selbstbewussten Position Brasiliens in einer zunehmend multipolaren Welt angemessen zu begegnen. Ihre strategische Agenda gerät dadurch immer mehr in Gefahr. |
| Keywords: | EU, Brasilien, Klima-Geopolitik, Dekarbonisierung, Wettbewerb, China, European Green Deal, EGD, Net Zero Industry Act, Critical Raw Materials Act, Global Gateway, BRICS, Carbon Border Adjustment Mechanism, CBAM, EU-Regulation on Deforestation-free Products, EUDR, Mercosur |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpakt:315496 |
| By: | Könneke, Jule; Adolphsen, Ole |
| Abstract: | Auf der 29. Weltklimakonferenz (COP29) vom 11. bis 24. November 2024 wurde deutlich, dass sich die Kräfteverhältnisse in der internationalen Klimapolitik nach den Wahlen in den USA verschieben. China spielte bei den Verhandlungen zu internationaler Klimafinanzierung eine konstruktive Rolle. Vulnerable Länder waren dennoch zu schmerzhaften Kompromissen bei der Klimafinanzierung gezwungen. Saudi-Arabien und andere Schwellenländer blockierten den Themenkomplex Emissionsminderung stärker denn zuvor. Die Kritik mittlerer Mächte an Klimaschutzmaßnahmen der EU wuchs. Um eine fortschreitende Isolation der EU und negative Implikationen für ihre klima- und wettbewerbspolitische Agenda zu verhindern, muss die neue Europäische Kommission ihre klimadiplomatischen Anstrengungen anders ausrichten. |
| Keywords: | New Collective Quantified Goal (NCQG), COP29, Weltklimakonferenz, USA, China, EU, New Collective Quantified Goal, NCQG, Baku to Belém Roadmap to 1.3T, United Nations Framework Convention on Climate Change, UNFCCC, Carbon Border Adjustment Mechanism, CBAM, Global Gateway |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpakt:315499 |
| By: | Guglielmo Maria Caporale; Nieves Carmona-González; Luis Alberiko Gil-Alana; María Fátima Romero Rojo |
| Abstract: | This paper analyses trends and persistence in air pollution levels in 88 US metropolitan areas using fractional integration methods. The results indicate that the differencing parameter d is higher than 0 in 38 of the series, which supports the hypothesis of long-memory behaviour and implies that, although the effects of shocks are long-lived, they eventually die out. The highest degrees of persistence are found in the Fresno, Bakersfield, Bradenton and San Diego areas. On the whole the gathered evidence indicates that regional differences in pollution levels are significant, with factors such as industrialisation history and extreme weather events playing a crucial role in their degree of persistence. This suggests that, in order to tackle pollution more effectively, federal environmental policies, such as the Clean Air Act, should be complemented by more targeted ones taking into account local characteristics. |
| JEL: | C22 Q53 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11827 |
| By: | Schenuit, Felix; Treß, Domenik |
| Abstract: | Die Rolle von Technologien zur dauerhaften Entnahme von Kohlendioxid (CO2) aus der Atmosphäre (Carbon Dioxide Removal, CDR) wird im Rahmen der Erarbeitung eines neuen EU-Emissionsreduktionsziels für 2040 und einer deutschen Langfriststrategie Negativemissionen intensiv diskutiert. Ergänzend zu diesen Langfriststrategien bedarf es einer Kurzfriststrategie, damit die Skalierung von Technologien für industrielles CDR gelingt. Bislang liegt der Fokus häufig auf einer konzeptionellen Diskussion darüber, welche Mengen an CDR im Netto-Null-Jahr benötigt werden. Zu wenig Beachtung findet die Frage, wie und mit welchem Vorlauf die ersten großskaligen CDR-Projekte überhaupt entstehen können. Einige Länder haben bereits kurzfristige Instrumente entwickelt, um einen ersten Investitionsschub in Technologien für industrielles CDR auszulösen. Eine vergleichende Bewertung dieser Ansätze zeigt mehrere umsetzbare Politikoptionen für eine gezielte CDR-Skalierung in der EU und Deutschland auf. |
| Keywords: | CO2-Entnahme, permanente CO2-Entnahme, Carbon Dioxide Removal, CDR, Carbon Management, industrielles CDR, CDR-Technologien, CDR-Skalierung, CDR-Hochlauf, CDR-Politik, CCS, CCU, LULUCF, Langfriststrategie Negativemissionen, LNe, Netto-Null-Ziele |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpakt:315514 |
| By: | Credit, Kevin |
| Abstract: | As per capita on-road CO2 emissions continue to rise in the US, a better understanding of the emissions-reduction benefits of building a new transit system is needed. Employing a novel quasi-experimental event study methodology, the results of this paper indicate that after 8 years of operation, construction of a light rail system has led to a small but significant reduction in regional on-road CO2 per capita of 8.4% - 12.9%. These results are robust to selection of control group and are larger than the estimated impact of light rail construction on population density (1.0%), evaluated in a comparative quasi-“placebo” study. |
| Date: | 2025–03–14 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:euyj6_v2 |
| By: | Michael Gechter; Namrata Kala |
| Abstract: | Firm location decisions are a key managerial choice, usually optimized over factors like proximity to customers or suppliers. These decisions may also impose externalities on the environment, and on other firms due to competitive or agglomerative forces. The inherent endogeneity of location decisions makes estimating the impact of firm presence difficult. In this paper, we study an environmental place-based policy that randomly moved over 20, 000 small firms in New Delhi to industrial areas outside the city over several years. We find that a reduction in firm presence improves air quality, reducing industrial pollution by 8% for the average neighborhood. However, industrial relocation is costly for firms, significantly increasing the probability of firm exit. We combine the exogenous assignment of firms to industrial plots with a model of firms playing a game of incomplete information to estimate the effect of neighborhood composition on firm survival through Marshallian agglomeration forces. We find that proximity to neighboring firms with input-output linkages increases the likelihood of firm survival, and taking these into account while determining firm placement in industrial areas would have halved the costs imposed on firms by the policy. These results provide causal evidence on the trade-offs between firm presence and environmental quality, and show that firm spillovers can be a useful force to minimize the costs on regulated firms. |
| JEL: | D22 L20 O10 Q52 Q53 Q56 Q58 R38 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33707 |
| By: | Ayers, Megan; Sanford, Luke; Gardner, Will; Kuebbing, Sara |
| Abstract: | Recent work has questioned the credibility of forest carbon offsets as an environmental intervention and nature-based solution for mitigating climate change. Despite some updates to carbon credit methodologies and advice to purchase only high-integrity or high-quality credits, it is not clear which carbon offsets meet these standards under which conditions. In this paper, we draw on the fields of statistics and causal inference to develop a generalized framework for analyzing carbon offset protocols. We show that strategic enrollment combined with even seemingly innocuous measurement errors in carbon stocks can lead to market distortions and that there is an inherent tradeoff between minimizing these distortions and broadening enrollment. The provided framework clarifies what purchasers of carbon offsets must believe about the world in order for purchased credits under each protocol to accurately reflect the impact of crediting programs and builds common ground on which more fruitful engagement between different sectors of the carbon market can build agreement. |
| Date: | 2025–03–07 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:5pcuh_v2 |
| By: | Lea-Rachel Kosnik; John C. Whitehead; Timothy C. Haab |
| Abstract: | In 2023, a survey was given to environmental and natural resource economists to gauge levels of consensus in the field. Respondents were queried on core topics in the discipline, including air quality, groundwater, climate change, natural resource management, land conservation, environmental justice, and more. Many of the survey questions mirrored questions from the first such survey of environmental and natural resource economists in 2012, but additional questions on newer topics were also added. From these survey results, we can determine contemporary levels of consensus in the field, as well as how these levels have changed over the last decade. We find, for the most part, significant levels of consensus today, and over time, on many key topics including the prevalence of market failures and support for policy interventions including Pigouvian taxes and cap-and-trade schemes. At the same time, some areas with lower levels of consensus today, and over time, include the effects of population growth on the environment, and what to do with revenues from policy interventions such as taxes or cap-and-trade schemes. Key Words: environmental policy, natural resources, professional consensus, survey, academic opinion, AERE |
| JEL: | A1 A2 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:apl:wpaper:25-02 |
| By: | Drigo, Alessandra |
| Abstract: | This study offers the first analysis of environmental and climate inequalities at the census tract level in Italy, providing valuable insights into spatial patterns of environmental and social vulnerability. The results highlight significant environmental inequality related to exposure to air pollution (PM2.5), as well as climate inequality linked to thermal discomfort (measured by the Discomfort Index). Among all regions, the Padana Valley stands out as the most severely affected by both stressors, marking its population as particularly vulnerable—regardless of their socioeconomic status. At the national level, the analysis identifies a negative correlation between exposure to environmental stressors and income proxies, and a positive correlation with the presence of non-European foreign residents. These associations remain robust even when the focus shifts to census tracts within the same municipality, suggesting that environmental and social inequalities persist not only across regions but also within local urban contexts. |
| Keywords: | Climate Change, Sustainability |
| Date: | 2025–04–18 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:356626 |
| By: | Lin, Jiang |
| Keywords: | Social and Behavioral Sciences |
| Date: | 2025–04–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:agrebk:qt6nm5m57z |
| By: | Adolphsen, Ole; Könneke, Jule; Schenuit, Felix |
| Abstract: | Mit dem Green Deal hat die EU in den vergangenen Jahren nicht nur eine deutliche Ambitionssteigerung ihrer Klimapolitik vollzogen, sondern die europäische Klimainnenpolitik um eine internationale Dimension erweitert. Tatsächlich betreffen zahlreiche Rechtsakte der EU direkt oder indirekt auch internationale Partner. Dennoch werden interne und externe Dimension der Klimapolitik in der neuen EU-Kommission nicht systematisch zusammengeführt, eine strategische diplomatische Flankierung der Maßnahmen ist nicht gegeben. Gerade mit Blick auf die erhöhte Bedeutung von Wettbewerbsfähigkeit und geopolitischen Konstellationen eröffnet sich die Chance für einen neuen Strategieprozess. Dieser könnte dazu beitragen, dass EU-Institutionen und Mitgliedstaaten die externe Dimension koordinieren und eine sinnvolle Weiterentwicklung der europäischen Klimapolitik erreichen. |
| Keywords: | EU-Klimapolitik, European Green Deal, Klimainnen- und -außenpolitik, EU-Rechtsakte, EU-Kommission, Kommissionspräsidentin Ursula von der Leyen, Wettbewerbsfähigkeit |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpakt:315501 |
| By: | Kevin Andrew (Pacific Institute for Climate Solutions); Jevan Cherniwchan (McMaster University); Mamoon Kader (Department of Economics, Carleton University); Hashmat Khan (Department of Economics, Carleton University) |
| Abstract: | The technique effect – the reduction in aggregate pollution emissions due to reductions in the pollution intensity of individual industries – is often interpreted as evidence that countries are getting cleaner because of improvements in how goods and services are produced. We extend the standard decomposition used in previous research to show the technique effect may also capture changes in the geography of economic activity. An empirical application to Canada suggests such changes may be economically important. While the technique effect decreased aggregate Canadian pollution intensity by 18.0% between 2009-2021, if the pollution intensity of production had remained fixed, within-industry shifts in production across Canada would have increased aggregate pollution intensity by over 11%. The technique effect decreased Canadian pollution intensity because these within-industry shifts were accompanied by reductions in pollution intensity that were greatest in provinces that received the largest within-industry reallocation of economic activity. |
| Keywords: | Pollution Decomposition, Technique Effect |
| JEL: | Q56 R11 |
| Date: | 2024–10–04 |
| URL: | https://d.repec.org/n?u=RePEc:car:carecp:24-03 |
| By: | Chiaki Hara (Kyoto University - Institute of Economic Research); Thorsten Hens (University of Zurich - Department of Banking and Finance; Norwegian School of Economics and Business Administration (NHH); Swiss Finance Institute) |
| Abstract: | We give a general equilibrium model of incomplete asset markets in which investors care not only about risk and return but also have ESG concerns. We consider two notions of equilibrium, a market value maximization equilibrium and a Dreze equilibrium. While the firms simply maximize profit with respect to common state prices at a market value maximization equilibrium, each firm maximizes profit with respect to the weighted average of its shareholders' subjective state prices at a Dreze equilibrium. We take the difference in social welfare between the two as the impact of shareholder engagement. We establish the existence of these equilibria. We give an equivalent condition for the two to coincide, which means that shareholder engagement makes no difference. We show, moreover, that even when it makes a difference, it is at most of second order, hence negligible, in a sense that can be made precise. |
| Keywords: | ESG, CAPM, incomplete markets, shareholder engagement, representative investor, Grassmann manifold |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:chf:rpseri:rp2547 |
| By: | Voorintholt, Lieke (University of Groningen); van den Berg, Gerard J. (University of Groningen); Soetevent, Adriaan R. (University of Groningen) |
| Abstract: | Concerns about offspring’s life quality are often cited as a motivation for caring about climate change. This paper investigates the hypothesized causal effect of grandparenthood on climate change worries, using panel data surveys among British families. Specifically, we study whether becoming a grandparent increases these worries. We employ two different study designs to deal with endogeneity of grandparenthood. The assumptions required to identify causal effects differ and are non-nested. However, results based on the two approaches are remarkably congruent. We find no empirical support for a relationship between grandparental status and concerns about climate change. |
| Keywords: | offspring, intergenerational altruism, global warming, anticipation, future climate |
| JEL: | D64 J13 Q51 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17795 |
| By: | Yerushalmi, Erez; Saha, Krishnendu |
| Abstract: | Circular economy (CE) is championed as a sustainability solution, promoting reuse, recycling, and resource efficiency to reduce environmental harm. However, efficiency innovations can trigger a rebound effect (RE), where lower costs stimulate higher consumption and production, paradoxically negating sustainability gains. This study applies a multi-region, multi-sector Dynamic Computable General Equilibrium (DCGE) model to quantify the circular economy rebound effect in the textile and clothing (TC) sector, the second most polluting industry. Our findings reveal a 155% rebound backfire, showing that CE innovations in the TC sector may exacerbate rather than mitigate environmental pressures. This challenges the assumption that CE alone can drive sustainability and underscores the need for complementary policies. We explore one policy - a uniform Pigouvian tax on TC production, finding that a minimum rate of 1.25% is required to curb the RE. However, effective implementation requires targeted regulatory interventions that also account for socio-economic trade-offs, particularly in low-income countries. To achieve truly sustainable outcomes, we argue for exploring broader systemic shifts, including insights from Degrowth theory. |
| Keywords: | Circular Economy (CE); Rebound Effect (RE); Computable General Equilibrium (CGE); Degrowth; Textile and Clothing |
| Date: | 2025–04–28 |
| URL: | https://d.repec.org/n?u=RePEc:akf:cafewp:35 |
| By: | Jennifer Alix-García; Christopher R. Knittel |
| Abstract: | Mangroves provide vital ecosystem services like storm surge protection and carbon sequestration, but their coverage is rapidly declining. This study evaluates an environmental education program in the Dominican Republic, targeting children’s attitudes, knowledge, behaviors, and willingness to pay for conservation. The program boosted attitudes, especially in girls, with modest, non-significant behavioral changes. There were also positive spillover effects on peers and parents, with non-treated peers in clubs showing increased mangrove preference and positive attitude shifts in parents. |
| JEL: | C93 I25 Q57 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33675 |
| By: | Leonardo Ciambezi (Université Côte d'Azur, CNRS, GREDEG, France); Alessandro Pietropaoli (Université Côte d'Azur, CNRS, GREDEG, France) |
| Abstract: | Is inflation equal for all? Combining Italian Household Budget Survey (HBS), Survey on Household Income and Wealth (SHIW) and Harmonised Index of Consumer Prices (HICP) data, we investigate the heterogeneity of Italian households’ inflation experiences over the period 2015-2023, conditional on their income and other observable characteristics. Following several years of distributional inflation neutrality, we find that the price surge that began in mid-2021 especially increased the cost of living of poorer households and more fragile socio-demographic groups, contributing therefore to increase overall inequality. After peaking in the second half of 2022, the aggregate inflation rate sharply declined in 2023 and so did the differential exposure of Italian households. In addition, by mapping each of the 480 HBS items into 90 ECOICOP 3- and 4-digit level categories, we show that between 2021 and 2022 more than 20% of the measured differential inflation between the top and the bottom income deciles comes from more granular information and would remain hidden by merely relying on 2-digit product-price data. Finally, the comparison over time between Laspeyres and Paasche average inflation rates reveals that while the two indices have generally coincided during normal times, the Paasche index-based inflation rate has consistently been higher than the Laspeyres measure since inflation began to rise. This puzzling result highlights the exceptional nature of the recent inflationary context - mostly driven by energy price shocks - where income effects rather than substitution effects seem to have prevailed across Italian households. |
| Keywords: | Household-specific inflation rates, Energy price shocks, Inflation inequality, Italy |
| JEL: | D31 E31 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:gre:wpaper:2025-18 |
| By: | Ansari, Dawud; Gehrung, Rosa Melissa; Pepe, Jacopo Maria |
| Abstract: | In Zentralasien verfolgen insbesondere Kasachstan und Usbekistan immer ambitioniertere Ziele mit Blick auf erneuerbare Energien. Neben China als etabliertem Akteur sind es vor allem einzelne Golfstaaten, insbesondere Saudi-Arabien, teils auch die Vereinigten Arabischen Emirate (VAE), die zunehmend entsprechende Projekte umsetzen. Die bisher kooperativ angelegte Präsenz von Golfstaaten und Chinas in Zentralasien, basierend auf Marktteilung entlang der Wertschöpfungskette, könnte eine Blaupause für die global immer wichtiger werdenden Golf-China-Beziehungen sein - aber auch ein Beispiel für neue energie- und geopolitische Verflechtungen, die Europas Einfluss entzogen sind. Für die EU und Deutschland sollte dies eine doppelte Warnung sein: Während intra-asiatische Dynamiken an Bedeutung gewinnen, laufen Deutschland und die EU Gefahr, energie-, klima- und geopolitisch marginalisiert zu werden - nicht nur in Zentralasiens erneuerbarem Energiesektor. Um dem entgegenzuwirken, braucht es neben einer konsistenteren Zentralasienstrategie auch einen konstruktiven und von Ideologie unbelasteten Ansatz für die Beziehungen gegenüber den arabischen Golfstaaten. |
| Keywords: | Golfstaaten, China, Saudi-Arabien, Kasachstan, Usbekistan, Vereinigte Arabische Emirate (VAE), Zentralasien, erneuerbare Energien, grüne Energie, "Seidenstraßen"-Initiative, Wasserstoff |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpakt:315497 |
| By: | Ansari, Dawud; Gehrung, Rosa Melissa; Pepe, Jacopo Maria |
| Abstract: | Der Großraum Asien entwickelt sich zu einem Zentrum der globalen Energiewende. Kennzeichnend ist dabei eine wachsende Unabhängigkeit von externen Akteuren wie der EU und den USA, während Dynamiken und Vernetzung zunehmend innerhalb der Region stattfinden. Was sich hier abzeichnet, sind beispielsweise Tendenzen zur Monopolisierung kritischer Rohstoffe, neue Allianzen auf Basis wachsender Interdependenzen entlang Wertschöpfungsketten sowie ein Trend zu innovativen Technologien wie kleinen modularen Atomreaktoren. Gleichzeitig könnte die Energiewende in der Region durch geopolitische Spannungen und potentielle Krisen erheblich beeinflusst werden. Um in Asien relevant und handlungsfähig zu bleiben, sollten Deutschland und die EU ihr dortiges Engagement konstruktiver ausrichten. |
| Keywords: | Großraum Asien, Geopolitik, Energiewende, Monopolisierung, kritische Rohstoffe, Wertschöpfungsketten, innovative Technologien, strategische Vorausschau |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swpakt:315504 |