SCEPA's Economics of Climate Change project — directed by Professor Willi Semmler — held a workshop on Tuesday, October 25th on the macroeconomic analysis of trends in climate change and climate disasters. The role of the financial market was explored, as were policy efforts in mitigation and adaptation and the distributional effects of climate policies and industrial, fiscal, and monetary policies.
The plenary speaker was Paul de Grauwe, the John Paulson Chair in European Political Economy at the London School of Economics, who discussed where the U.S. and E.U. stand in terms of energy transition and the suitable macro (monetary and fiscal) policy instruments in the short and long run.
Other discussion topics included:
- What are the obstacles for green investments in addition to rising energy prices and interest rates?
- What are the possible effects of the fossil fuel embargo? To what extent can energy independence be achieved, given the constraints on the resource side?
- What is the role of the public sector in this energy transition, and how should it interact with the private economic sector? What policies could support a just and fair transition?
- How might an eventual economic crisis interact with an energy crisis, and how might the E.U. fare differently than the U.S?
Introductory Remarks | Professor Willi Semmler
(See presentation here.)
Session 1 | Dynamic Macroeconomics: 9:00 – 10:30am
Moderator: Oriol Vallès Codina
- Julia Puashunder (9:10 – 9:30): Resilience Finance: The Role of Diversity, Hope, and Science Diplomacy (See presentation here.)
- Gabriel Padró Rosario (9:30 – 9:50): Endogenous Economic Resilience, Loss of Resilience, Persistent Cycles, Multiple Attractors, and Disruptive Contractions
- Jose Bastos Neves (9:50-10:10): A Credit Flow Macro Model with Nonlinear Phillips Curve: Economic Scenarios for the Pandemic Recovery Under Monetary Tightening (See presentation here.)
- Ibrahim Tahri (10:10-10:30): Sustainable Investment under Inflation and Interest Rate Risk
Session 2 | Financial Markets and Climate Change: 10:30 – 11:10am
- Welcome remarks by the Dept Chair Professor Sanjay Reddy
- Professor Hans Helmut Kotz (Harvard University, former Board Member of the Bundesbank): Financial Market as a Roadblock or Bridge to Climate Protection?
Session 3 | Climate Change and Green Transition: 11:10 – 1:30 pm
Moderator: Jose Bastos Neves
- Andreas Lichtenberger (11:10 -11:30): Fighting climate change on the back of low-income households? An analysis of the redistributive effects of the quasi-experimental policy of a revenue recycling carbon tax in British Columbia. (See presentation here.)
- Amit Roy (11:30-11:50): Effect of Carbon Tax on Economy and Emission: Revisiting Fiscal Policy in Regime Switching Model.
- Ettore Gallo (11:50 - 12:10): Reduction of CO2 Emissions, Climate Damage and the Persistence of Business Cycles: A Model of (De)coupling. (See presentation here.)
- Behnaz Minooei Fard (12:10 - 12:30): Limit pricing and entry game of renewable energy firms into the energy sector.
- Feridoon Koohi-Kamali (12:30-12:50) - Climate Change and Water Crisis. (See presentation here.)
- Francesco Lucidi (12:50-1:10) - The macroeconomic effects of temperature shocks in Europe.
- Damien Parker (1:10-1:30) - Monetary policy and wealth distribution (with some remarks by Jose Bastos and Willi Semmler on the proposal of a carbon wealth tax) (See presentation here.)
Lunch Break | 1:30 – 2:00pm
Session 4 | Plenary Speaker: Professor Paul de Grauwe (LSE): 2:00 pm – 3:00 pm
Moderator: Professor Willi Semmler (NSSR) (See presentation here.)
Session 5: Central Banks and Climate Change: 3:00 – 3:50pm
- João Braga (3:00-3:20) - Central Banks and Climate Change (See presentation here.)
- Dr. Jerome Henry, ECB (Principal Advisor) (3:20-3:40) - ECB Policy and Climate Change (See presentation here.)