Publication: Carbon pricing and inflation expectations: evidence from France
Carbon pricing and inflation expectations: evidence from France
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Hensel, J., Mangiante, G., & Moretti, L. (2023). Carbon pricing and inflation expectations: evidence from France (No. 434; Working Paper Series / Department of Economics).
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This paper studies the impact of carbon pricing on firms’ inflation expectations and discusses the potential implications for what constitutes the core of most central banks’ mandate: price stability. Carbon policy shocks are identified from high-frequency changes in carbon futures price around regulatory events. The shock series is combined with French firm-level survey data. We document that a change in the price of carbon increases firms’ inflation expectations. We then investigate how firms’ business conditions are affected by car
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Hensel, J., Mangiante, G., & Moretti, L. (2023). Carbon pricing and inflation expectations: evidence from France (No. 434; Working Paper Series / Department of Economics).