Monetary Policy for the Climate? A Money View Perspective on Green Central Banking

Publikation: Working paperForskningpeer review

Abstract

Central banks can potentially influence the investment decisions of private financial institutions, which in turn will create incentives towards green technology adoption and development of lower emission business models. This paper examines how monetary policies can be deployed to promote a greening of finance. To guide the efforts, the paper mobilizes the Money View literature. This enables a comparative assessment of different monetary policy options. The main finding is that a promising way forward for green monetary policy is to adopt a strategy of expanding collateral eligibility through positive screening and widening haircut spreads to change relative incentives in favor of green over brown assets.
OriginalsprogEngelsk
UdgivelsesstedNew York
UdgiverInstitute for New Economic Thinking (INET)
DOI
StatusUdgivet - 20 jun. 2022
NavnInstitute for New Economic Thinking (INET)
Vol/bind188

Emneord

  • Climate change
  • green central banking
  • monetary policy
  • Collateral Policy
  • haircuts

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