How can central banks help mitigate climate change? A Money View perspective on green central banking

Research output: Working paperResearchpeer-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
central bankers are engaging with the green transition agenda. 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 Central Banking is to adopt a dual strategy of
expanding collateral eligibility through positive screening and widening haircut
spreads to change relative incentives in favor of green over brown assets.
Original languageEnglish
Place of PublicationRoskilde
PublisherRoskilde Universitet
Number of pages26
ISBN (Print)978-87-7349-042-6
Publication statusPublished - 1 Mar 2022
SeriesSECO Working Paper Series
Number3
Volume2022
ISSN2446-337X

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