Monitoring the Climate Impact of Fiscal Policy - Lessons from Tracking the COVID-19 Response

By Khaled Eltokhy, Katja Funke, Guohua Huang, Yujin Kim, Genet Zinabou

October 29, 2021

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Format: Chicago

Khaled Eltokhy, Katja Funke, Guohua Huang, Yujin Kim, and Genet Zinabou. Monitoring the Climate Impact of Fiscal Policy - Lessons from Tracking the COVID-19 Response, (USA: International Monetary Fund, 2021) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

In the wake of the COVID-19 crisis, governments around the world announced unprecedented fiscal packages to address the economic impact of the crisis. The unusually large scale of the packages was accompanied by widespread calls for “greening” them to meet the dual goals of economic recovery and environmental sustainability. In response, several researchers and international organizations attempted to assess the “greenness” of the fiscal policy response of the world’s largest economies. This paper takes stock of the contributions made by these various trackers, identifies strengths and weaknesses of their methodologies, and draws lessons for assessing the climate impact of fiscal policy going forward. It finds that: trackers provided useful assessments of the (generally low) level of greenness and raised awareness; trackers’ methodologies, while valid and innovative, varied significantly with some important, if currently largely unavoidable, weaknesses; and the way forward should involve tracking the greenness of entire government budgets, rather than just their response to the COVID-19 crisis.

Subject: Climate change, Climate policy, Environment, Environmental policy, Greenhouse gas emissions

Keywords: Climate change, Climate impact, Climate impact assessment, Climate policy, Climate relevance, COVID-19, COVID-19 response, Environmental policy, Fiscal policy response, Global, Green budgeting, Green fiscal policy tracker, Green fiscal policy tracker, Greenhouse gas emissions, IMF Green tracker policy archetype

Publication Details

Pages:

34
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2021/259
Stock No:

WPIEA2021259
ISBN:

9781589067769
ISSN:

1018-5941

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