6533b85dfe1ef96bd12bddd7

RESEARCH PRODUCT

Carbon and inflation

Angel Pardo

subject

Inflation050208 financeInflaciómedia_common.quotation_subject05 social sciencesMonetary economicsEconomiaCarbó0502 economics and businessEconomicsFisher hypothesisPositive relationshipmedia_common.cataloged_instance050207 economicsEuropean unionHedge (finance)Financemedia_common

description

Abstract This paper investigates whether European Union Allowances (EUAs) can serve as an inflation hedge for two economic areas, four euro countries and two non-euro countries. The Extended Fisher Hypothesis is tested and the evidence shows a strong positive relationship between EUA returns and the unexpected inflation component in all the economic areas or countries analysed, except for the US. Therefore, EUAs are able to provide a hedge against unanticipated inflation rates.

yearjournalcountryeditionlanguage
2021-01-01
10.1016/j.frl.2020.101519https://hdl.handle.net/10550/82898