The propagation effect of climate risks on global stock markets: Evidence from the time and space domains

Libo Yin and Hong Cao

Energy Economics, 2024, vol. 132, issue C

Abstract: This study delves into the propagation effect of climate risks on global stock markets, emphasizing the dynamics of contagion. We first trace the contagion pathway of climate risks across global stock markets, revealing an initial diffusion to Asian markets, followed by European markets, and ultimately reaching American markets. The HSI (Hong Kong, China), DAX (Germany), and SZ (China) markets emerge as pivotal nodes for the indirect transmission of overall climate risk. Additionally, we scrutinize the propagation dynamics of climate risks across varying timescales, noting a heightened magnitude and swifter pace at short-timescale compared to the long-timescale. Lastly, we conduct a comparative analysis of the propagation impact of distinct types of climate risks, identifying drought and precipitation risks as exerting a more pronounced influence on stock markets, both in terms of propagation speed and magnitude, relative to temperature risks.

Keywords: Climate risks; Global stock market indexes; Propagation effect; Ripple-spreading network model; Temporal analysis; Spatial analysis (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0140988324001531
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:132:y:2024:i:c:s0140988324001531

DOI: 10.1016/j.eneco.2024.107445

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().