As part of the Brown Bag Lunch series, the International Economics Department at the Graduate Institute is pleased to invite you to a public talk given by Laura Minu Nowzohour, PhD Candidate in International Economics, who will present her co-authored paper with Joëlle Noailly.

Does environmental policy uncertainty deter green FDI inflows into the US?

by Laura Minu Nowzohour and Joëlle Noailly

Abstract: 

Massive investment efforts and technological advances are necessary to implement the transition to a low-carbon economy. To gauge the full potential of investments in clean technologies, domestic and foreign sources of capital should be considered as a source of crucial financing and knowledge spillovers. In this paper, I ask whether firms are discouraged from undertaking long-term clean-tech investments in the US following a shock in US environmental policy uncertainty. And if so, do foreign firms react differently from domestic ones? To answer these questions, I take advantage of the fDi Markets database by the Financial Times recording greenfield investments across the globe at the quarterly level since 2003 -- with the unique advantage that it tags these deals by cluster, purpose and sector, thus allowing me to track the patterns of deals in the Environmental Technology (ET) cluster into the US over time. In regressions, I first look at the effect of aggregate inflows and then at country-level bilateral inflows of such deals. I also aim to include a more granular firm-level analysis, however, this is complicated due to a little available balance sheet data for firms who engage in ET deals as many of these are not listed.