Spillovers and connectedness among climate policy uncertainty, energy, green bond and carbon markets: A global perspective

Extreme weather anomalies, energy crisis and environmental degradation have garnered significant attention in the context of sustainable development. This paper analyses the spillovers among climate policy uncertainty (CPU), energy prices, green bond index, and carbon emission trading price with qua...

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Bibliographic Details
Main Author: Wang, Kai-Hua (author)
Other Authors: Wang, Zu-Shan (author), Yunis, Manal (author), Kchouri, Bilal (author)
Format: article
Published: 2023
Online Access:http://hdl.handle.net/10725/17646
https://doi.org/10.1016/j.eneco.2023.107170
http://libraries.lau.edu.lb/research/laur/terms-of-use/articles.php
https://www.sciencedirect.com/science/article/pii/S0140988323006680
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Summary:Extreme weather anomalies, energy crisis and environmental degradation have garnered significant attention in the context of sustainable development. This paper analyses the spillovers among climate policy uncertainty (CPU), energy prices, green bond index, and carbon emission trading price with quantile connectedness approach. The results suggest that connectedness among variables is higher at the extreme quantiles than the median quantile, and the connectedness would strengthen during international events, such as the US withdrawal from the Paris Agreement, COVID-19 epidemic, and Russian-Ukraine conflict. Additionally, the dynamic spillover analysis further demonstrates that CPU consistently acts as the risk receiver and passively bears influence from other markets. The constructed theoretical mechanism provides valuable insights for a comprehensive assessment of climate policy, facilitating the orderly functioning of energy, green finance and carbon markets, and sustainable investment. Thus, the paper concludes that the significant spillover from energy, green bond and carbon markets serve as useful indicators for judging and predicting uncertainties related to climate policy.