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Inflation in the time of climate change: a tail of unrequited love?: the effect of greenhouse gas emissions policies on the tails of the inflation distribution in Europe

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dc.contributor.author Torres, Angela
dc.contributor.author Vargas, Joelky
dc.contributor.author Weatherburn, William
dc.date.accessioned 2022-12-22T10:31:31Z
dc.date.available 2022-12-22T10:31:31Z
dc.date.issued 2022-06-13
dc.identifier.uri http://hdl.handle.net/10230/55220
dc.description Treball fi de màster de: Master's Degree in Specialized Economic Analysis: Macroeconomic Policy and Financial Markets. Curs 2021-2022
dc.description Supervised by: Luis Rojas and Hugo Rodríguez
dc.description.abstract To reduce greenhouse gas emissions European countries have primarily relied on two polices: carbon taxes and the Emissions Trading Scheme. A growing body of research has studied the effect that these policies have had on the macroeconomy, including on inflation. However, current literature has concentrated on the effect of these policies on the mean inflation rate, ignoring the effect on unlikely but extreme inflation outcomes. To the best of our knowledge, our paper is the first to study the effect of EU carbon policies on the distribution of inflation. We perform panel quantile regressions on 17 European countries and find that the Emissions Trading Scheme price and carbon tax growth predict the mean and upper 10% of the inflation distribution contemporaneously. We then estimate impulse response functions to examine how these policies affect the distribution of inflation into the future.
dc.description.abstract Los países europeos se han basado en dos políticas para reducir sus emisiones: impuestos a las emisiones y el comercio de permisos de emisión. Aunque efectivas, estas políticas no son inocuas al relacionarse con la inflación. No obstante, la literatura se ha concentrado en el efecto sobre la media, ignorando el efecto sobre las colas de la inflación (niveles inflacionarios poco probables pero extremos). Para estudiar el efecto de estas políticas sobre la distribución de la inflación, implementamos regresiones por quintiles adaptadas un panel de 17 países y encontramos que ambas políticas predicen solamente la media y el 10% superior de la distribución. Además, estimamos funciones de respuesta al impulso mediante proyecciones locales para examinar cómo afectan la distribución en el futuro.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.rights Atribución-NoComercial-SinDerivadas 3.0 España
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.subject.other Treball de fi de màster – Curs 2021-2022
dc.subject.other Canvis climàtics – Europa
dc.title Inflation in the time of climate change: a tail of unrequited love?: the effect of greenhouse gas emissions policies on the tails of the inflation distribution in Europe
dc.type info:eu-repo/semantics/masterThesis
dc.subject.keyword Inflation-at-risk
dc.subject.keyword Inflation distribution
dc.subject.keyword Tail risks
dc.subject.keyword Climate change
dc.subject.keyword Distribución de la inflación
dc.subject.keyword Riesgos de cola
dc.subject.keyword Cambio climático
dc.rights.accessRights info:eu-repo/semantics/openAccess

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