Search Options
Home Media Explainers Research & Publications Statistics Monetary Policy The €uro Payments & Markets Careers
Sort by

Emerging Markets Group (EMG) and European Central Bank Workshop

The Open Economy of Climate Change

15 September 2023

Venue: Bayes Business School, City, University of London

Climate change poses major risks to natural, human and economic systems. Reaching carbon neutrality by 2050 has become one of the world’s most urgent priorities (IPCC, 2022). However, annual global clean-energy investments would have to exceed four trillion USD by 2030, three times its average over the past five years, for the world to reach this goal (IEA, 2021). To mitigate fragmentation and harness the potential of private investments globally, the international climate finance architecture is growing. While some governments are competing to attract low-carbon investments within their borders (e.g. US IRA, EU Fit-for-55 package), others benefit from blended finance initiatives.

Regional large-scale policies and climate change itself substantially affect the global macroeconomy via two main channels: transition and physical risk. Climate mitigation policy has the potential to affect global balances and induce rapid sectoral and cross-country shifts of financial, trade and capital flows. Such tectonic shifts will likely be felt differently depending on e.g. the local economic structure and resilience of the financial sector. The reliance on critical minerals can add additional complexity. Likewise, the probability and impacts of physical risks are heterogenous, depending on e.g. local adaptation efforts and the extent of insurance. Deep interlinkages between transition and physical risk imply an important role for expectations for the level of economic stress potential such shocks have.

The politics of climate policies are particularly volatile. Competing interests by different countries and economic stakeholders as well as long time lags between action and effect when it comes to climate change mitigation underline the important role of frictions. Better understanding these channels has motivated us to organise this workshop.

Keynote Speaker

Galina Hale

  • Professor of Economics UC Santa Cruz (UCSC)
  • Research Associate at the National Bureau of Economic Research (NBER)
  • Research Fellow at the Center for Economic Policy Research (CEPR)
  • Program director at Central Bank Research Association (CEBRA)
  • Co-director at Center for Analytical Finance (CAFIN) at UCSC

Call for papers

Submission deadline: 1 June 2023


On behalf of the Emerging Markets Group (EMG), Bayes Business School, City University of London and the European Central Bank (ECB), the organizers invite submissions for an EMG/ECB workshop on “The Open Economy of Climate Change” and in particular on the following issues:

  • The reaction of key open-economy macro-financial variables (e.g. current account balances, exchange rates, interest rates, commodity prices) to
    • Transition risk (e.g. climate policies, their stringency, credibility, timeliness, design, degree of coordination, behavioural changes, technological progress).
    • Physical risk (e.g. natural disasters, rising temperatures).
  • Patterns of international financial flows in response to transition and/or physical risks
    • International bank lending patterns
    • International bond or equity flows
    • International fund flows
  • The role of transition-critical mineral supply for the transition
  • Climate policy, international trade and carbon leakage
  • The role of capital flows and innovation in the low-carbon transition, especially in EMDEs
  • The role of international (re-)insurance markets in a world of increasing physical risks
  • The role of the international climate finance architecture to mitigate fragmentation and harness the potential of global investments, especially for EMDEs (e.g. blended finance, international technology transfers)
  • The impact of climate policy and disasters on global inequality 


Completed papers in PDF form are to be submitted via this form.

The deadline for paper submission is 1 June 2023. Authors of accepted papers for the workshop will be notified by the end of June 2023.

Registration is free and participants, apart from keynote speakers, are expected to cover their own travel and accommodation costs.

Scientific Committee

  • Ana-Maria Fuertes (Bayes Business School)
  • Ian Marsh (Bayes Business School)
  • Kate Phylaktis (Bayes Business School)
  • Laura Nowzohour (ECB)
  • Livio Stracca (ECB)
  • Maria Sole Pagliari (Banque de France)
  • Massimo Ferrari Minesso (ECB)
  • Richard Payne (Bayes Business School)

Conference Organisers

  • Kate Phylaktis (Bayes Business School)
  • Livio Stracca (ECB)
  • Laura Nowzohour (ECB)