Sudden carbon price rise risks major financial shocks – ECB paper

Carbon emission

Policy-makers should raise carbon prices early and gradually to avoid major financial sector shocks, a working paper published by the European Central Bank finds.

In “Euro area banks’ sensitivity to changes in carbon price”, Marco Belloni, Friderike Kuik and Luca Mingarelli present a model of the eurozone’s banking sector. The model uses the concept of network contagion to simulate the impact on eurozone banks of a rise in carbon prices.

The authors apply this model to a granular dataset

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Central Banking? View our subscription options

If you already have an account, please sign in here.

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: