About
I am a researcher in climate finance and PhD candidate at the Institute for Ecological Economics of WU Vienna, as well as a financial stability expert at the European Central Bank. I apply methods from complexity economics and post-Keynesian economics to better understand the effect of climate risk on the economy and the financial system in particular.
Job market paper
I am on the job market with my paper “Credit and climate sentiments: the decarbonization frontier of risk pricing”.
Abstract:
The role of banks in supporting the low-carbon transition has proved controversial as they have priced climate transition risk but maintained investment in polluting industries. This paper provides first a theoretical benchmark for the carbon premium, based on a formalization of the concept of climate sentiments, the policy-dependent present value of firms’ capital, and the Merton model. I find that the current empirical evidence for carbon premia matches a reasonable calibration of investment dynamics in productive capital, with a limited space for higher premia even when banks strongly expect future climate-mitigation policies. Second, I consider discrepancies in climate sentiments between lenders and borrowers, to determine when banks could push reticent borrowers to green their operations, or prevent them from doing so. I find that variations in the cost of debt due to the carbon premium are generally not enough of a decarbonization incentive alone. Macro-prudential measures that complement carbon pricing and policies that limit the lending volume would then be necessary to decarbonize the economy further through the financial system.
Education
- PhD candidate in Economics, Vienna University of Economics and Business (Austria), 2020 - Present
- MSc in Applicable Mathematics, London School of Economics and Political Science (U.K.), 2017 - 2018
- MSc in Engineering, Télécom Paris (France), 2015 - 2017
Contact
regis.gourdel [at] wu.ac.at