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Transmission to a low-carbon economy and its implications for financial stability in Russia

Author

Listed:
  • Anna Burova

    (Bank of Russia, Russian Federation)

  • Elena Deryugina

    (Bank of Russia, Russian Federation)

  • Nadezhda Ivanova

    (Bank of Russia, Russian Federation)

  • Maxim Morozov

    (Bank of Russia, Russian Federation)

  • Natalia Turdyeva

    (Bank of Russia, Russian Federation)

Abstract

Energy transition and climate policies associated with it may become one of the major challenges for the Russian economy. We present an approach to assessing consequences of climate policy for Russia and evaluating related transition risks for the country’s financial system. This approach relies on a CGE model for the Russian economy and a financial model based on firm-level data. We show that both international and domestic climate policies affect the financial stability of the Russian Federation. The effects of international climate actions summarised in the NGFS Net Zero 2050 scenario are bigger than the effects of the introduction of a domestic emission trading system with a reduction goal of the Intensive scenario of the Russian state strategy of low-carbon development.

Suggested Citation

  • Anna Burova & Elena Deryugina & Nadezhda Ivanova & Maxim Morozov & Natalia Turdyeva, 2023. "Transmission to a low-carbon economy and its implications for financial stability in Russia," Bank of Russia Working Paper Series wps109, Bank of Russia.
    • Handle: RePEc:bkr:wpaper:wps109
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    References listed on IDEAS

    as
    1. Hossein Hosseini & Craig Johnston & Craig Logan & Miguel Molico & Xiangjin Shen & Marie-Christine Tremblay, 2022. "Assessing Climate-Related Financial Risk: Guide to Implementation of Methods," Technical Reports 120, Bank of Canada.
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    3. Christoph Böhringer & Thomas F. Rutherford & David G. Tarr & Natalia Turdyeva, 2017. "Market Structure and the Environmental Implications of Trade Liberalization: Russia’s Accession to the World Trade Organization," World Scientific Book Chapters, in: Trade Policies for Development and Transition, chapter 20, pages 459-485, World Scientific Publishing Co. Pte. Ltd..
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    5. Drehmann, Mathias & Juselius, Mikael, 2014. "Evaluating early warning indicators of banking crises: Satisfying policy requirements," International Journal of Forecasting, Elsevier, vol. 30(3), pages 759-780.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Russia; climate policy; energy transition; transition risk; financial stability; CGE;
    All these keywords.

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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