The E-axes Forum on Climate Change, Macroeconomics, and Finance

Richhild Moessner

“Effects of Carbon Pricing on Inflation”

Event description

Richhild Moessner presented her recent work on the links of carbon pricing and inflationary pressures. From the abstract:

“We study how carbon pricing has affected inflation ex-post, using dynamic panel estimation of New-Keynesian Phillips curves for 35 OECD economies from 1995 to 2020. As carbon pricing we consider prices of emissions trading systems (ETS) and carbon taxes. We find that an increase in prices of ETS by $10 per ton of CO2 equivalents increases energy CPI inflation by 0.8 percentage points (pp), and headline inflation by 0.08pp, but has no significant effects on food and core CPI inflation. We also find that an increase in carbon taxes by $10 per ton of CO2 equivalents increases food CPI inflation by 0.1pp, but has no significant effects on energy CPI inflation, headline and core CPI inflation.”

Please note that this webinar was not recorded. You can find the recordings of all previous and future webinars on our website.

Moderator:

Pierre Monnin
Senior Fellow, CEP

Richhild Moessner

Richhild Moessner is working as a Senior Economist in the Monetary & Economic Department of the Bank for International Settlements, and is also a CESifo research network fellow. Richhild previously worked as a senior policy adviser at the Dutch central bank, as a manager and senior economist at the Bank of England, and as a senior economist in the European Central Bank’s research department.

Paper and slides

Effects of Carbon Pricing on Inflation (Paper)

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