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Sustainable Investing and Political Behavior


Heeb, Florian; Kölbel, Julian; Ramelli, Stefano; Vasileva, Anna (2024). Sustainable Investing and Political Behavior. Swiss Finance Institute Research Paper 23-46, University of Zurich.

Abstract

A major concern regarding sustainable investing is that it may crowd out political support for government interventions targeting negative externalities. We test the validity of this concern in a preregistered experiment shortly before a real referendum on a climate law with a representative sample of the Swiss population (N = 2,051). We find that the opportunity to invest in a climate conscious fund does not erode individuals’ support for climate regulation. Our experimental results are consistent with actual voting and investing behavior across Switzerland. We conclude that the spillover effects of sustainable investing on individual political behavior are limited.

Abstract

A major concern regarding sustainable investing is that it may crowd out political support for government interventions targeting negative externalities. We test the validity of this concern in a preregistered experiment shortly before a real referendum on a climate law with a representative sample of the Swiss population (N = 2,051). We find that the opportunity to invest in a climate conscious fund does not erode individuals’ support for climate regulation. Our experimental results are consistent with actual voting and investing behavior across Switzerland. We conclude that the spillover effects of sustainable investing on individual political behavior are limited.

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Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Banking and Finance
Dewey Decimal Classification:330 Economics
JEL Classification:D14, H42, G18, P16
Uncontrolled Keywords:Behavioral Finance, Climate Change, ESG, Externalities, Sustainable Finance, Political Economy, Voting Behavior
Scope:Discipline-based scholarship (basic research)
Language:English
Date:16 March 2024
Deposited On:20 Nov 2023 14:23
Last Modified:16 Apr 2024 12:01
Series Name:Swiss Finance Institute Research Paper
Number of Pages:75
ISSN:1556-5068
OA Status:Green
Free access at:Publisher DOI. An embargo period may apply.
Publisher DOI:https://doi.org/10.2139/ssrn.4484166
Other Identification Number:merlin-id:24169
  • Content: Published Version
  • Language: English