Macroeconomic and environmental effects of portfolio decarbonisation strategies

Anna Bartocci (), Pietro Cova (), Valerio Nispi Landi (), Andrea Papetti () and Massimiliano Pisani
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Anna Bartocci: Bank of Italy
Pietro Cova: Bank of Italy
Valerio Nispi Landi: Bank of Italy
Andrea Papetti: Bank of Italy

No 874, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We show, using three different macroeconomic models, that portfolio decarbonisation strategies, by imposing tighter financing conditions on firms that can engage in both brown and green investments, may not reduce CO2 emissions or reduce them at the cost of output loss. On the contrary, portfolio decarbonisation strategies that selectively relax and tighten the financing conditions for, respectively, green and brown investments, could lower emissions and improve macroeconomic activity.

Keywords: portfolio decarbonisation strategy; financing conditions; green and brown investments; macroeconomic effects (search for similar items in EconPapers)
JEL-codes: E20 E22 Q43 Q5 (search for similar items in EconPapers)
Date: 2024-10
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Citations: View citations in EconPapers (1)

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