@misc{SchuetzeFuerstMielkeetal.2017, author = {Sch{\"u}tze, Franziska and F{\"u}rst, Steffen and Mielke, Jahel and Steudle, Gesine A. and Wolf, Sarah and J{\"a}ger, Carlo C.}, title = {The Role of Sustainable Investment in Climate Policy}, series = {Postprints der Universit{\"a}t Potsdam : Wirtschafts- und Sozialwissenschaftliche Reihe}, journal = {Postprints der Universit{\"a}t Potsdam : Wirtschafts- und Sozialwissenschaftliche Reihe}, number = {137}, issn = {1867-5808}, doi = {10.25932/publishup-47048}, url = {http://nbn-resolving.de/urn:nbn:de:kobv:517-opus4-470485}, pages = {21}, year = {2017}, abstract = {Reaching the Sustainable Development Goals requires a fundamental socio-economic transformation accompanied by substantial investment in low-carbon infrastructure. Such a sustainability transition represents a non-marginal change, driven by behavioral factors and systemic interactions. However, typical economic models used to assess a sustainability transition focus on marginal changes around a local optimum, whichby constructionlead to negative effects. Thus, these models do not allow evaluating a sustainability transition that might have substantial positive effects. This paper examines which mechanisms need to be included in a standard computable general equilibrium model to overcome these limitations and to give a more comprehensive view of the effects of climate change mitigation. Simulation results show that, given an ambitious greenhouse gas emission constraint and a price of carbon, positive economic effects are possible if (1) technical progress results (partly) endogenously from the model and (2) a policy intervention triggering an increase of investment is introduced. Additionally, if (3) the investment behavior of firms is influenced by their sales expectations, the effects are amplified. The results provide suggestions for policy-makers, because the outcome indicates that investment-oriented climate policies can lead to more desirable outcomes in economic, social and environmental terms.}, language = {en} } @phdthesis{Schuetze2020, author = {Sch{\"u}tze, Franziska}, title = {Finance for a sustainable economy}, doi = {10.25932/publishup-48441}, url = {http://nbn-resolving.de/urn:nbn:de:kobv:517-opus4-484415}, school = {Universit{\"a}t Potsdam}, pages = {xi, 128}, year = {2020}, abstract = {With his September 2015 speech "Breaking the tragedy of the horizon", the President of the Central Bank of England, Mark Carney, put climate change on the agenda of financial market regulators. Until then, climate change had been framed mainly as a problem of negative externalities leading to long-term economic costs, which resulted in countries trying to keep the short-term costs of climate action to a minimum. Carney argued that climate change, as well as climate policy, can also lead to short-term financial risks, potentially causing strong adjustments in asset prices. Analysing the effect of a sustainability transition on the financial sector challenges traditional economic and financial analysis and requires a much deeper understanding of the interrelations between climate policy and financial markets. This dissertation thus investigates the implications of climate policy for financial markets as well as the role of financial markets in a transition to a sustainable economy. The approach combines insights from macroeconomic and financial risk analysis. Following an introduction and classification in Chapter 1, Chapter 2 shows a macroeconomic analysis that combines ambitious climate targets (negative externality) with technological innovation (positive externality), adaptive expectations and an investment program, resulting in overall positive macroeconomic outcomes. The analysis also reveals the limitations of climate economic models in their representation of financial markets. Therefore, the subsequent part of this dissertation is concerned with the link between climate policies and financial markets. In Chapter 3, an empirical analysis of stock-market responses to the announcement of climate policy targets is performed to investigate impacts of climate policy on financial markets. Results show that 1) international climate negotiations have an effect on asset prices and 2) investors increasingly recognize transition risks in carbon-intensive investments. In Chapter 4, an analysis of equity markets and the interbank market shows that transition risks can potentially affect a large part of the equity market and that financial interconnections can amplify negative shocks. In Chapter 5, an analysis of mortgage loans shows how information on climate policy and the energy performance of buildings can be integrated into risk management and reflected in interest rates. While costs of climate action have been explored at great depth, this dissertation offers two main contributions. First, it highlights the importance of a green investment program to strengthen the macroeconomic benefits of climate action. Second, it shows different approaches on how to integrate transition risks and opportunities into financial market analysis. Anticipating potential losses and gains in the value of financial assets as early as possible can make the financial system more resilient to transition risks and can stimulate investments into the decarbonization of the economy.}, language = {en} } @misc{WolfSchuetzeJaeger2016, author = {Wolf, Sarah and Sch{\"u}tze, Franziska and Jaeger, Carlo}, title = {Balance or synergies between environment and economy}, series = {Postprints der Universit{\"a}t Potsdam : Wirtschafts- und Sozialwissenschaftliche Reihe}, journal = {Postprints der Universit{\"a}t Potsdam : Wirtschafts- und Sozialwissenschaftliche Reihe}, number = {126}, issn = {1867-5808}, doi = {10.25932/publishup-43699}, url = {http://nbn-resolving.de/urn:nbn:de:kobv:517-opus4-436998}, pages = {13}, year = {2016}, abstract = {The UN sustainable development goals contain environmental, economic, and social objectives. They may only be reached, or at least it would be easier to reach them, if instead of a trade-off between these objectives that implies a need for balancing them, there are synergies to be reaped. This paper discusses how the structures of economic models typically used in policy analysis influence whether win-win strategies for the environment and the economy can be conceptualised and analysed. With a focus on climate policy modelling, the paper points out how, by construction, commonly used model structures find mitigation costs rather than benefits. This paper describes mechanisms that, when added to these model structures, can bring win- win options into a model's solution horizon, and which provide a spectrum of alternative modelling approaches that allow for the identification of such options.}, language = {en} }