Do markets Trump politics? Fossil and renewable market reactions to major political events
(2024) In Economic Inquiry 62(2). p.805-836- Abstract
- We investigate the effects of three events with major importance for climate policy on energy sector stocks: the Paris Agreement, the Trump election and presidency, and the Biden election. By combining event studies with impulse-indicator saturation methods, we show that the Paris Agreement and the election of Mr. Biden benefited renewable industries, while the election of Mr. Trump had negative effects. For fossil fuel industries, the effects were largely the opposite. Despite Trump's efforts to eliminate environmental regulations, his presidency did however witness a decrease in both US coal production and consumption, while natural gas and oil consumption increased.
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/405b294a-4864-4594-8778-32e44e8d0d9f
- author
- Mukanjari, Samson LU and Sterner, Thomas
- organization
- publishing date
- 2024-03-13
- type
- Contribution to journal
- publication status
- published
- subject
- keywords
- climate policy, elections, energy, event study, Paris Agreement, Stock returns, stranded assets
- in
- Economic Inquiry
- volume
- 62
- issue
- 2
- pages
- 805 - 836
- publisher
- Wiley-Blackwell
- external identifiers
-
- scopus:85178955816
- ISSN
- 1465-7295
- DOI
- 10.1111/ecin.13195
- language
- English
- LU publication?
- yes
- id
- 405b294a-4864-4594-8778-32e44e8d0d9f
- date added to LUP
- 2023-12-15 15:57:43
- date last changed
- 2024-04-11 15:33:19
@article{405b294a-4864-4594-8778-32e44e8d0d9f, abstract = {{We investigate the effects of three events with major importance for climate policy on energy sector stocks: the Paris Agreement, the Trump election and presidency, and the Biden election. By combining event studies with impulse-indicator saturation methods, we show that the Paris Agreement and the election of Mr. Biden benefited renewable industries, while the election of Mr. Trump had negative effects. For fossil fuel industries, the effects were largely the opposite. Despite Trump's efforts to eliminate environmental regulations, his presidency did however witness a decrease in both US coal production and consumption, while natural gas and oil consumption increased.}}, author = {{Mukanjari, Samson and Sterner, Thomas}}, issn = {{1465-7295}}, keywords = {{climate policy; elections; energy; event study; Paris Agreement; Stock returns; stranded assets}}, language = {{eng}}, month = {{03}}, number = {{2}}, pages = {{805--836}}, publisher = {{Wiley-Blackwell}}, series = {{Economic Inquiry}}, title = {{Do markets Trump politics? Fossil and renewable market reactions to major political events}}, url = {{http://dx.doi.org/10.1111/ecin.13195}}, doi = {{10.1111/ecin.13195}}, volume = {{62}}, year = {{2024}}, }