– with Matteo Deleidi, Riccardo Pariboni and MarcoVeronese Passarella – Socio-Economic Planning Sciences –
We develop an ecological open-economy stock-flow consistent model that enables testing cross-area interactions among productive sectors, financial markets, social groups and the ecosystem. We argue that green financial investments can bring about unwanted ecological implications. Besides, the unequal diffusion of green technologies and assets across areas can lead the governments of less ecologically efficient areas to move further away from low-carbon policies. Mission-oriented green policies can smooth the side effects of traditional fiscal policies. However, their effectiveness depends crucially on the impact of cross-border financial flows (and growth rate differentials) on exchange rates. Lacking a cross-area policy coordination plan, currency fluctuations may well counteract green behaviours and policies.
Link to Socio-Economic Plannig Sciences