How Large is the Sovereign Greenium?

Sakai Ando, Chenxu Fu, Francisco Roch and Ursula Wiriadinata
Additional contact information
Sakai Ando: IMF
Chenxu Fu: University of Tokyo
Ursula Wiriadinata: IMF

No 253, Working Papers from Red Nacional de Investigadores en Economía (RedNIE)

Abstract: This paper assembles a comprehensive sovereign green bond database and estimates the sovereign greenium. The development of green bond markets has been one of the most important financial breakthroughs in the domain of sustainable finance during the last 15 years. A central benefit associated with green bonds has been that they exhibit a positive green premium (greenium), i.e., a lower yield relative to a similar conventional bond. Yet, issuances at the sovereign level have been relatively recent and not well documented in the literature. We find that green bonds are issued at a relatively small premium (4 basis pointson average) in Advanced Economies. Yet, importantly, the greenium is growing over time and is considerably larger (11 basis points on average) for Emerging Market Economies.

Keywords: Green bonds; Sustainable finance; Financial innovation; Sovereign debt; Greenium; Climate change. (search for similar items in EconPapers)
JEL-codes: F34 G15 H63 Q01 Q58 (search for similar items in EconPapers)
Pages: 14 pages
Date: 2023-06
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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https://rednie.eco.unc.edu.ar/files/DT/253.pdf (application/pdf)

Related works:
Journal Article: How Large is the Sovereign Greenium? (2024)
Working Paper: How Large is the Sovereign Greenium? (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:aoz:wpaper:253

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