Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/278355 
Year of Publication: 
2023
Series/Report no.: 
ECB Working Paper No. 2779
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
We use a DSGE model to study the effectiveness of green-asset purchases by the central bank (Green QE), along the transition to a carbon-free economy driven by an emission tax, abstracting from price stability considerations. We find that Green QE helps to further reduce emissions, especially in the early stage of the transition. We find that a crucial parameter to determine the effectiveness of Green QE is the elasticity of substitution between the brown and the green good: the higher the elasticity the stronger the impact of the policy on emissions.
Subjects: 
Central Bank
Monetary Policy
Quantitative Easing
Climate Change
JEL: 
E52
E58
Q54
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-5521-8
Document Type: 
Working Paper

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