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Political Science > Environmental Policy

You are looking at 1 - 7 of 7 items for :

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Cover IMF Staff Country Reports
New Zealand: Selected Issues
International Monetary Fund. Asia and Pacific Dept
This Selected Issues paper investigates why New Zealand’s inflation is higher and further from target than comparator economies considering two main hypotheses: (1) the persistence of pandemic era shocks, and (2) strong migration inflows fuelling demand. The paper finds that, like in many advanced economies, expansionary fiscal and monetary policy, high global commodity prices, exchange rates, and high maritime transport costs all fed into higher inflation. However, unique for New Zealand, the delayed reopening of the economy likely caused a postponed demand shock relative to similar economies. Results show that the impact of these shocks decay rapidly over time, suggesting positive short-term inflation dynamics. With an eye for what lies ahead, the paper finds that large migration waves are associated with short-run increases in inflation, but that these effects are relatively modest and no longer significant after four years. Instead, the long-run dynamics show evidence that migration can lead to significant long-term gains to productivity, output, and capital growth. Countries with tight labor markets exhibit similar patterns to those without, except the inflationary effects of migration dissipate faster.
Keywords:
supply and demand demand shock; PPI inflation; net migration trend; climate goal; impulse response; Migration; Inflation; Greenhouse gas emissions; Climate policy; Labor markets; Global
Cover IMF Staff Country Reports
Kingdom of the Netherlands–The Netherlands: 2024 Article IV Consultation-Press Release; and Staff Report
International Monetary Fund. European Dept.
The 2024 Article IV Consultation discusses that the economy has cooled, but signs of overheating remain in The Netherlands. After two years of strong recovery, growth decelerated in 2023, reflecting the energy shock, tighter financial conditions, and a slowdown in key trading partners, particularly Germany. Core inflation remains elevated, reflecting a tight labor market, robust wage growth, and healthy profit margins. Growth is expected to gradually regain momentum in 2024, driven by higher private consumption and external demand. High interest rates will weigh on business and residential investment. For 2024, given the high cost of underestimating inflation persistence, a non-expansionary stance is warranted; adjustment measures should be identified. Medium-term fiscal challenges call for structural reforms to stabilize debt. Climate mitigation strategies need to tackle implicit fuel subsidies, striking the right balance among regulation, pricing/feebates, and subsidies, while addressing distributional concerns and ensuring policy predictability.
Keywords:
government Finance statistics yearbook; IMF staff calculation; core inflation persistence; EMU aggregate; consultation cycle; Labor markets; Inflation; Labor shortages; Fiscal stance; Europe
Cover IMF Staff Country Reports
New Zealand: Selected Issues
International Monetary Fund. Asia and Pacific Dept
This Selected Issues paper on New Zealand discusses addressing climate change. projections suggest the gap between New Zealand’s emissions targets and the projected path have narrowed significantly though more needs to be done if the Nationally Determined Contribution for 2030 is to be met. Three critical policy initiatives were introduced in 2022: the first Emissions Reduction Plan and associated emissions budgets were adopted; the National Adaptation Plan was published; and the government proposed its framework for pricing agriculture emissions, which account for around 62 percent of net emissions and are the missing piece in the emissions pricing framework. However, policies intended to address the cost-of-living crisis such as cuts to fuel taxes and duties could have an adverse impact on the feasibility of New Zealand’s emissions targets if prolonged. The heightened policy uncertainty was reflected in carbon prices: after peaking in November 2022, the price in the secondary market declined sharply and the June 2023 average price was around 40 percent below the peak level. The March 2023 Emissions Trading Scheme (ETS) auction failed to clear, resulting in no new units being released. This is a cause for concern: If falling prices are not arrested, the envisaged emissions reductions may be out of reach. Further, as proceeds from the ETS auctions are intended to be used to support climate investments, shortfalls could put these at risk.
Keywords:
wage Phillips Curve; wage growth; wage inflation; wage pressure; min. wage; inflation expectation; Wages; Minimum wages; Climate change; Greenhouse gas emissions; Climate finance; Australia and New Zealand; Global
Cover IMF Working Papers
Deconstructing ESG Scores: How to Invest with your own Criteria?
Torsten Ehlers, Ulrike Elsenhuber, Kumar Jegarasasingam, and Eric Jondeau
Environmental, Social, and Governance (ESG) scores are a key tool for asset managers in designing and implementing ESG investment strategies. They, however, amalgamate a broad range of fundamentally different factors, creating ambiguity for investors as to the underlying drivers of higher or lower ESG scores. We explore the feasibility and performance of more targeted investment strategies based on specific ESG categories, by deconstructing ESG scores into their granular components. First, we investigate the characteristics of the various categories underlying ESG scores. Not all types of ESG categories lend themselves to more focused strategies, which is related to both limits to ESG data disclosure and the fundamental challenge of translating qualitative characteristics into quantitative measures. Second, we consider an investment scheme based on the exclusion of firms with the lowest scores in a given category of interest. In most cases, this strategy allows investors to substantially improve the ESG category score, with a marginal impact on financial performance relative to a broad stock market benchmark. The exclusion results in regional and sectoral biases relative to the benchmark, which may be undesirable for some investors.We then implement a “best-in-class” strategy by excluding firms with the lowest category scores and reinvesting the proceeds in firms with the highest scores, maintaining the same regional and sectoral composition. This approach reduces the tracking error of the portfolio and slightly improves its risk-adjusted performance, while still yielding a large gain in the targeted ESG category score.
Keywords:
Sustainable investment; ESG ratings; ESG investing; Negative screening; Best-in-class screening; ESG score; ESG category; headline ESG; ESG data disclosure; Corporate social responsibility; Greenhouse gas emissions; Labor force; North America; Global; Europe
Cover IMF Working Papers
Transitioning to a Greener Labor Market: Cross-Country Evidence from Microdata
Mr. John C Bluedorn, Mr. Niels-Jakob H Hansen, Diaa Noureldin, Mr. Ippei Shibata, and Ms. Marina Mendes Tavares
This paper builds a new set of harmonized indicators of the environmental properties of jobs using micro-level labor force survey data from 34 economies between 2005 and 2019 and analyzes the labor market implications of the green economic transition and environmental policies. Based on the new set of indicators, the paper's main findings are that greener and more polluting jobs are concentrated among smaller subsets of workers, individual workers rarely move from more pollution-intensive to greener jobs, and workers in green-intensive jobs earn on average 7 percent more than workers in pollution-intensive jobs.
Keywords:
Green jobs; Green Skills; Polluting jobs; Emissions; Environmental Regulation.; labor market implication; IMF working paper 2022/146; pollution intensity; green job; implications of the green; polluting job; Environmental policy; Employment; Labor markets; Climate change; Africa; Global; intensity score; emissions intensity; worker reallocation support; job-to-green job transition; pollution intensities of employment
Cover IMF Working Papers
From Polluting to Green Jobs: A Seamless Transition in the U.S.?
Katharina Bergant, Rui Mano, and Mr. Ippei Shibata
What are the implications of the needed climate transition for the potential reallocation of the U.S. labor force? This paper dissects green and polluting jobs in the United States across local labor markets, industries and at the household-level. We find that geography alone is not a major impediment, but green jobs tend to be systematically different than those that are either neutral or in carbon-emitting industries. Transitioning out of pollution-intensive jobs into green jobs may thus pose some challenges. However, there is a wage premium for green-intensive jobs which should encourage such transitions. To gain further insights into the impending green transition, this paper also studies the impact of the Clean Air Act. We find that the imposition of the Act caused workers to shift from pollution-intensive to greener industries, but overall employment was not affected.
Keywords:
Green and polluting employment; Green Labor Market Transition; Environmental Regulation; IMF working paper Western Hemisphere department; green job; polluting employment; polluting job; Employment; Environmental policy; Labor markets; Wages; Global
Cover IMF Working Papers
Employment Effects of Environmental Policies – Evidence From Firm-Level Data
Mr. Adil Mohommad
The employment impact of environmental policies is an important question for policy makers. We examine the effect of increasing the stringency of environmental policy across a broad set of policies on firms’ labor demand, in a novel identification approach using Worldscope data from 31 countries on firm-level CO2 emissions. Drawing on evidence from as many as 5300 firms over 15 years and the OECD environmental policy stringency (EPS) index, it finds that high emission-intensity firms reduce labor demand upon impact as EPS is tightened, whereas low emission-intensity firms increase labor demand, indicating a reallocation of employment. Moreover, tightening EPS during economic contractions appears to have a positive effect on employment, other things equal. Quantifications exercises show modest positive net changes in employment for market-based policies, and modest negative net changes for non-market policies (mainly emission quantity regulations) and for the combined aggregate EPS. Within market-based policies, the percent decline in employment in high-emission firms (correspondingly the increase in low-emission firms) for a unit change in a policy index is smallest (largest) for trading schemes (“green” certificates, and “white” certificates)—although stringency is not comparable across indices. Finally, the employment effects of EPS are not persistent.
Keywords:
IMF working paper research Department; employment effect; emission-intensity firm; policy index; intensity firm; Employment; Environmental policy; Greenhouse gas emissions; Labor demand; Non-renewable resources; Global