Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/307373 
Authors: 
Year of Publication: 
2024
Series/Report no.: 
CESifo Working Paper No. 11443
Publisher: 
CESifo GmbH, Munich
Abstract: 
This article reviews a rapidly growing literature on how climatic risks and events affect public finances around the world. This literature includes empirical evaluations of how past climatic events have affected fiscal outcomes, empirical and model-based assessments of how climatic risks affect public borrowing costs, and macro-fiscal-climate models that investigate the policy and welfare implications of fiscal climate risks. This article highlights five stylized facts that emerge from this literature and points to important knowledge gaps for future research. Key findings include the facts that (i) the fiscal costs of climatic risks are economically significant overall, (ii) lower-income and credit-constrained regions are especially vulnerable and poorly insured against growing climatic fiscal risks, but that (iii) fiscal policy responses to climatic risks can mitigate their economic impacts substantially.
Subjects: 
climate change
fiscal costs
public budgets
sovereign debt
natural disasters
climate adaptation
social cost of carbon
integrated assessment
JEL: 
Q54
H20
H50
H60
H70
H84
Document Type: 
Working Paper
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