Project
A double systemic challenge awaits European societies. First, they will need to move towards a low-carbon productive system to mitigate climate change. Second, they will have to minimise the economic and financial disruptions this transition could trigger. To achieve these goals, financial systems have to be aligned with climate stability
A double systemic challenge awaits European societies. First, they will need to move towards a low-carbon productive system to mitigate climate change. Second, they will have to minimise the economic and financial disruptions this transition could trigger. To achieve these goals, financial systems have to be aligned with climate stability and transition objectives. This is why the EU-funded ERC-Starting SMOOTH project will delve into the psychological and institutional barriers to low-carbon investments, and will develop a novel macro-financial analytical framework to study potential decarbonisation scenarios. Combining climate macroeconomics, behavioural finance and political economy, this framework will analyse financial drivers and obstacles, as well as their implications for growth, financial stability, employment, distribution and private/public debt.