Building Back Better: How Big Are Green Spending Multipliers?
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Summary:
This paper provides estimates of output multipliers for spending in clean energy and biodiversity conservation, as well as for spending on non-ecofriendly energy and land use activities. Using a new international dataset, we find that every dollar spent on key carbon-neutral or carbon-sink activities can generate more than a dollar’s worth of economic activity. Although not all green and non-ecofriendly expenditures in the dataset are strictly comparable due to data limitations, estimated multipliers associated with spending on renewable and fossil fuel energy investment are comparable, and the former (1.1-1.5) are larger than the latter (0.5-0.6) with over 90 percent probability. These findings survive several robustness checks and lend support to bottom-up analyses arguing that stabilizing climate and reversing biodiversity loss are not at odds with continuing economic advances.
Series:
Working Paper No. 2021/087
Subject:
Economic sectors Environment Environmental protection Financial crises Greenhouse gas emissions Non-renewable resources Renewable energy Renewable resources
Frequency:
regular
English
Publication Date:
March 19, 2021
ISBN/ISSN:
9781513574462/1018-5941
Stock No:
WPIEA2021087
Pages:
47
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