EIEE Webinar-Seminar
, 12:00 CET
To join the webinar, register here
Speaker
Stefano Ramelli, tenure-track Assistant Professor in finance at the University of St. Gallen and a faculty member at the Swiss Finance Institute
Abstract
We study an overlooked driver of “green” investments, subjective expectations about the future trajectory of the energy transition (climate transition beliefs). In a representative survey of U.S. retail investors (N=1,007), we observe considerable heterogeneity in climate transition beliefs at different long-term horizons. We find that transition optimism positively correlates with expected green financial performance and preferences for green investments, especially for investors without strong pro-environmental attitudes. Two pre-registered information provision experiments (total N=4,004) provide causal evidence of the role of heterogeneous transition beliefs in driving green return expectations and investment decisions. By influencing green investments, beliefs around the energy transition can potentially have important self-fulfilling tendencies.