11:20 - 13:00
P2-S33
Room: -1.A.05
Chair/s:
Daniela Giannetti
Discussant/s:
Erik Voeten
Energy Costs and the Political Economy of the Green Energy Transition: Evidence from the EU
P2-S33-2
Presented by: Ireri Hernandez Carballo
Ireri Hernandez Carballo
Bocconi UniversityRFF-CMCC European Institute on Economics and the Environment
Do changes in energy prices impact individuals' attitudes towards the energy transition? Global energy markets are highly interconnected, making them a source of globalization that can impact public policy preferences. Shifts in energy prices due to global supply shocks or other crises impact household energy expenditures, cost of living, income, and inequality. A key question is how individuals will react to shifts in energy prices: will this affect environmental concern, public support of climate and energy policies, or other political attitudes? Which regions and social groups are more likely to be affected and respond more? I study changes in attitudes in the time frame of the 2022 Russian invasion of Ukraine, which led to a drastic increase in energy prices. I combine energy price data with geographical variation in energy use in an instrumental variables framework to study individual-level changes in public attitudes to answer this question. The focus is on the EU, which in 2020 imported 57\% of the energy it consumed, 24.4% coming from Russia. Initial results suggest that higher energy prices increase energy concerns but have a very small relative impact on environmental concerns, suggesting that worry about climate change is not crowded out by higher energy prices in this context.
Keywords: Environmental politics, energy transition, globalization

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