A (panel) svar for european climate policy

The Institute of Economics will hold a seminar meeting as part of its Seminar Series on Wednesday, June 15, 2022: Simone Maxand from the Europa Universität Viadrina will present the paper "A (panel) SVAR for European climate policy".

Abstract

Carbon emissions are priced in Europe in two ways: first, as a cap-and-trade-system the EU emission trading system sets a price on carbon. Following prior literature, this price is determined by energy prices, the macroeconomic development, weather and renewables. We analyse these interactions by a monthly smooth transition SVAR model identified by non-Gaussianity and narrative sign restrictions and find heterogeneous effects over two regimes of economic activity. Second, individually set carbon taxes cover a certain share of emissions in the separate member countries. We study these tax effects in a panel SVAR model which accounts for the joint market development. Joining the two models brings the development and effects of the identified structural carbon price/tax shocks on EU and country level together. The model framework additionally enables to set further country specific environmental policies in relation to the European macroeconomy.

The seminar will be held in blended mode. In person participation is possible and available seats are allocated on a first come first served basis. For online participation please use the following link.