When Green Investors Are Green Consumers
We bring investors with preferences for green assets to a general equilibrium setting in which they also prefer consuming green goods. Their preferences for green goods induce consumption premia on expected returns that counterbalance the green premium stemming from their preferences for green assets. Because they provide a hedge when green goods become expensive, brown assets command lower consumption premia, and green investors allocate a larger share of their portfolios towards them. Empirically, the green-minus-brown consumption premia differential reached 30-40 basis points annually, and contributes to explaining the limited impact of green investing on polluting firms’ costs of capital.
Date: 6 February 2023, 16:05 (Monday, 4th week, Hilary 2023)
Venue: Manor Road Building, Manor Road OX1 3UQ
Venue Details: Lecture Theatre or https://zoom.us/j/92415955348?pwd=ME5ybjVBVk90aThHdkcwVnZiUWF4Zz09
Speaker: David Zerbib (EDHEC Business School)
Organising department: Department of Economics
Part of: Environmental Economics Seminar
Booking required?: Not required
Audience: Members of the University only
Editor: Emma Heritage