Financing the Sustainable Development Goals

PoCfiN Working Paper 01/2020

24 Pages Posted: 6 Apr 2020

See all articles by Thomas Lagoarde-segot

Thomas Lagoarde-segot

KEDGE Business School; Sustainable Development Solutions Network (SDSN) - France

Date Written: March 11, 2020

Abstract

This paper contends that carving out pathways to finance the SDG agenda entails to reconsider tacit assumptions regarding the functioning of financial systems. We first use a history of economic thought perspective to demonstrate the flaws of the loanable fund theory, which has come to underlie SDG finance strategies. We then introduce the alternative endogenous money theory using a consistent theoretical and accounting framework. This allows us to identify and discuss a set of financing mechanisms, which would permit to bridge the SDG budget gap. These mechanisms include the issuing of sovereign green bonds, the modification of the European Central Bank’s collateral framework, changes in capital adequacy ratios, a market of SDG lending certificates and the introduction of rediscounting policies. We back up the discussion with examples from economic history.

Keywords: SDGs, Finance, Macroeconomic Policy, Endogenous money

JEL Classification: GOO

Suggested Citation

lagoarde-segot, thomas, Financing the Sustainable Development Goals (March 11, 2020). PoCfiN Working Paper 01/2020, Available at SSRN: https://ssrn.com/abstract=3552572

Thomas Lagoarde-segot (Contact Author)

KEDGE Business School ( email )

Domaine de Luminy - BP 921
BP 921
Marseille, PACA 13288
France

Sustainable Development Solutions Network (SDSN) - France ( email )

Paris
France

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
54
Abstract Views
206
rank
459,388
PlumX Metrics