Climate Change in the EU’s Macroeconomic Imbalance Procedure

Hungerland Wolf-Fabian and Altmeppen Christoph
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Hungerland Wolf-Fabian: Federal Ministry of Economic Affairs and Climate Action, Berlin; and Stanford Program in Berlin, Germany.
Altmeppen Christoph: Federal Ministry of Economic Affairs and Climate Action, Berlin, Germany.

Intereconomics: Review of European Economic Policy, 2024, vol. 59, issue 3, 176-182

Abstract: EU member states observe an elaborate process to preserve macroeconomic stability: the macroeconomic imbalance procedure (MIP). The MIP is supposed to monitor and prevent macroeconomic imbalances – and if necessary, correct them. It considers a variety of variables to determine the existence of imbalances, e.g. the current account balance or unit labour costs. However, the macroeconomic impact of climate change is ignored. In light of the growing economic risks due to climate change, this article argues that the MIP should consider climate-related risks explicitly to maintain relevance.

JEL-codes: E61 E62 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:intere:v:59:y:2024:i:3:p:176-182:n:1011

DOI: 10.2478/ie-2024-0035

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