Climate Polarization and Green Investment

56 Pages Posted: 24 Jan 2024 Last revised: 10 Apr 2024

See all articles by Anders Anderson

Anders Anderson

Swedish House of Finance; Stockholm School of Economics - Department of Finance; Mistra Center for Sustainable Markets

David T. Robinson

Fuqua School of Business, Duke University; National Bureau of Economic Research (NBER); Duke Innovation & Entrepreneurship Initiative

Multiple version iconThere are 2 versions of this paper

Date Written: January 18, 2024

Abstract

We build a nationally representative sample of retirement savers in Sweden to study how asymmetric updating of beliefs about climate change affects investment decisions. After the intense heat wave of 2018, respondents in regions dominated by a right-wing, anti-climate party grow less concerned about climate change, while respondents outside these regions grow more concerned. Those growing more concerned rebalance their retirement portfolios toward climate-friendly mutual funds; those growing less concerned rebalance out of these funds, but to a smaller degree. Financial sophistication and inertia interacts with political polarization in driving these effects.

Keywords: Household Finance, Carbon Emissions, Sustainability, Exclusions, Retirement Savings

JEL Classification: G11, G39

Suggested Citation

Anderson, Anders and Robinson, David T., Climate Polarization and Green Investment (January 18, 2024). Swedish House of Finance Research Paper No. 24-04, Available at SSRN: https://ssrn.com/abstract=4698638 or http://dx.doi.org/10.2139/ssrn.4698638

Anders Anderson (Contact Author)

Swedish House of Finance ( email )

Drottninggatan 98
111 60 Stockholm
Sweden

Stockholm School of Economics - Department of Finance ( email )

SE-113 83 Stockholm
Sweden

Mistra Center for Sustainable Markets ( email )

Stockholm

David T. Robinson

Fuqua School of Business, Duke University ( email )

100 Fuqua Drive
Durham, NC 27708-0120
United States
919-660-8023 (Phone)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Duke Innovation & Entrepreneurship Initiative ( email )

215 Morris St., Suite 300
Durham, NC 27701
United States

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